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Please answer and explain, thank you The table below is the balance sheet for all banks combined in the banking system. All banks have a
Please answer and explain, thank you
The table below is the balance sheet for all banks combined in the banking system. All banks have a target reserve ratio of 5%. Assets Liabilities/Equity Demand Deposits Reserves $3,037,500 Loans $160,000 $ 2,533,250 337,500 Shareholders' equity 337,500 Securities Fixed assets 344,250 Total 3,375,000 Total 3,375,000 a. The amount of excess reserves is $ b. The maximum amount that loans and deposits could be increased by is $ c. Assume that the system becomes fully loaned up. Show the new balance sheet in the table above. d. Now that the system is fully loaned up, the money supply will have increased by $Step by Step Solution
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