Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. First Main Street Bank takes the entire $8,000 in excess reserves that resulted from the open-market purchase by the fores and in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. checkable deposit. Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. Assets Liabilities Reserves Checkable Deposits Loans \begin{tabular}{l|c} & $8,000 \\ Now Second Repi & $68,000 \\ \hline checkable deposi & ses \\ & $332,000 \end{tabular} Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. \begin{tabular}{l|l|} \hline Now Second Repul & $1,200 \\ \hline checkable deposit. & $6,800 \\ \hline The money supply & $8,000 \\ \hline$68,000 \end{tabular} Now Second Republic Bank uses the entire $6,800 in excess reserves that resulted from Tim's deposit to create a Ioan for Alyssa in the form of a checkable deposit. The money supply now is Under these assumptions, the $8,000 injection into the money supply results in an overall increase of in checkable deposits. Therefore, the total money supply increases to Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. First Main Street Bank takes the entire $8,000 in excess reserves that resulted from the open-market purchase by the fores and in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. checkable deposit. Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. Assets Liabilities Reserves Checkable Deposits Loans \begin{tabular}{l|c} & $8,000 \\ Now Second Repi & $68,000 \\ \hline checkable deposi & ses \\ & $332,000 \end{tabular} Suppose again that checkable deposits started off at $400,000 in First Main Street Bank, the required reserve ratio is 15%, with no excess reserves and no cash leakage. in a form of a new checkable deposit with a balance of $8,000. The money supply now is Then Rosa writes a check for $8,000 to Tim, who immediately deposits the full amount into his checking account at Second Republic Bank. Complete the following table to show the effect of Tim's deposit on the Second Republic Bank's balance sheet. \begin{tabular}{l|l|} \hline Now Second Repul & $1,200 \\ \hline checkable deposit. & $6,800 \\ \hline The money supply & $8,000 \\ \hline$68,000 \end{tabular} Now Second Republic Bank uses the entire $6,800 in excess reserves that resulted from Tim's deposit to create a Ioan for Alyssa in the form of a checkable deposit. The money supply now is Under these assumptions, the $8,000 injection into the money supply results in an overall increase of in checkable deposits. Therefore, the total money supply increases to
