Principle 1. State the one condition that must exist for ONE bank in a multi-bank banking system to be able to create checking account balances (money) and state the quantity of checking account balances (money) that ONE bank can create, if, there is a LAW that REQUIRES banks to back up A FRACTION of their deposit customers' checking account balances with reserve assets: Answer: The ONE condition that must exist for that ONE Bank to be able to create checking account balances (money) is, that Bank must have positive Excess Reserves, and the QUANTITY of checking account balances (money) that Bank can create is equal to the size of their positive Excess Reserves Principle 2: State the QUANTITY of checking account balances (money) that a second Bank can create after the first bank creates checking account balances (money) Answer: The QUANTITY of checking account balances (money) that a second Bank can create after the first bank creates checking account balances (money) = Principle 3. State the total QUANTITY of checking account balances (money) all the banks combined will be able to create in a multi-bank banking system, if initially only ONE bank can create checking account balances (money). Answer: The total QUANTITY of checking account balances (money) all the banks combined will be able to create in a multi-bank banking system, if initially only ONE bank can create checking account balances (money) = Principle 4. State the one condition that must exist for ONE bank in a multi-bank banking system to be required to destroy checking account balances (money) and state the QUANTITY of checking account balances (money) that ONE bank must DESTROY, if, there is a law that requires banks' have to back up A FRACTION OF their deposit customers' checking account balances with reserve assets. Answer: The ONE condition that must exist for that ONE Bank if that bank is required to DESTROY checking account balances (money) is that ONE bank must have And the QUANTITY of checking account balances (money) that bank must destroy = Principle 5: State the QUANTITY of checking account balances (money) that a second Bank must destroy after the first bank destroys checking account balances (money) Answer: The QUANTITY of checking account balances (money) that a second Bank must destroy after the first bank destroys checking account balances (money) = Principle 6. State the total quantity of checking account balances (money) all the banks combined must destroy in a multi-bank banking system, if initially only ONE bank must destroy money The total QUANTITY of checking account balances (money) all the banks combined in a multi-bank banking system must destroy, if initially one bank must destroy checking account balances (money) =