Please help with this question. confused.
In the table below you will find simplified consolidated balance sheets for the chartered banking system and the Bank of Canada. Use columns 1-3 to indicate how the balance sheets would read after each of transactions in parts (a) to (c) is completed. Do not cumulate your answers; that is, analyze each transaction separately, starting in each case from the numbers provided. All accounts are in billions of dollars. a. A decline in the bank rate prompts chartered banks to borrow an additional $1 billion from the Bank of Canada. Show the new balance-sheet figures in column 1 of each table. b. The Bank of Canada sells $3 billion in securities to the public, who pay for the bonds with cheques. Show the new balance sheet figures in column 2 of each table. c. The Bank of Canada buys $2 billion of securities from chartered banks. Show the new balance sheet numbers in column 3 of each table. Instructions: All answers below are to be entered as whole numbers. Consolidated Balance Sheet: All chartered banks (billions of dollars) (1) (2) (3) Assets : Cash reserves $33 $ $ $ Securities 60 Loans 60 Liabilities: Demand deposits $150 $ $ Advances from Bank of Canada 3 Balance Sheet: Bank of Canada (billions of dollars) (1) (2) (3) Assets : Securities $60 $ $ $ Advances to chartered banks 3 Liabilities : Reserves of chartered banks $33 $ $ $ Government of Canada deposits 3 Notes in circulation 27d. Now review all of the above 3 transactions, asking yourself these three questions: (1) What change, if any, took place in the money supply as a direct and immediate result of each transaction? (2) What increase or decrease in chartered banks' cash reserves took place in each transaction? (3) Assuming a desired reserve ratio of 20 percent, what change in the moneycreating potential of the chartered banking system occurred as a result of each transaction? Transaction a: 1. The money supply - Options 2. Reserves from $33 to $ |:| billion. Decrease / Increase / Do not Change 3. Money-creating potential by $ |:| billion. Transaction b: 1. The money supply by as |:| billion- 2. Reserves from $33 to $ |:| billion. 3. Money-creating potential by $ |:| billion. Transaction c: 1. The money supply . 2. Reserves from $33 to $ - billion. 3. Money-creating potential by $ |:| billion