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Suppose banks keep no excess reserves and that all banks are currenty meeting the reserve requirement. The Foderal Reservo theo makes an open markot purchase
Suppose banks keep no excess reserves and that all banks are currenty meeting the reserve requirement. The Foderal Reservo theo makes an open markot purchase of $13.000 from Blank Use the T-acoount below to show the result of this transaction for Bank 1 , assuming Bank 1 keeps no excess reservos after the transoction. (Remomber Taccounts show the changes to a bs balance sheet) Assume al of Bank 1's loans of $13,000 sre spent by the borrowers and then deposied into Bank 2 Use the Tactount below to show the resut of this transaction for Bank 2, assuming Bank 2 keeps no excess feserves and the reserve requirement is 13%. (Renember Taccounts show the changes to a bank's bolance sheet) Assume at of Bark. 2 s loans of $11,310 are spent by the borrowers and then deposited into Bark 3. Use the T-account below to show the resut of this transaction for Bank 3, assuming thank 3 keepe no excess reserves and the roserve requirement is 13%. (Remember Taccounte show the changes to a bank's balance shoet)
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