Suppose that the legal reserve ratio set by the Fed is $10\%$ and that the Fair Bank in Fairdealing, Missouri initially has checkable

deposit equal to $$230$ and a reserve account of $$70.$

A customer of Fair Bank deposits $$100$ into her checking account. Fair Bank loans $80\%$ of the deposit and places the rest in its

reserves at the St$.$ Louis Fed. For simplicity, assume the borrower received the loan as cash.

How much does Fair Bank have in excess reserves after the deposit and loan?

Place the figures to represent changes in the accounts of Fair Bank and the Federal Reserve of St$.$ Louis' balance sheets resulting

from the deposit and loan.

Balance sheet: Fair Bank

Loans:

Property:

Balance sheet: Saint Louis Federal

Propert!

Loans: