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Suppose the Bank of Canada buys $50,000 in bonds from Bank 1 , and Bank 1 and all other banks have no excess reserves prior
Suppose the Bank of Canada buys $50,000 in bonds from Bank 1 , and Bank 1 and all other banks have no excess reserves prior to this purchase. a. What type of policy is this? A. Contractionary monetary policy B. Contractionary fiscal policy C. Expansionary monetary policy D. Expansionary fiscal policy E. None of the above What assets of Bank 1 change and by how much? Complete the second column of the following table by in each row entering " 0 " if the listed item is not an asset and/or does not change, a ositive number representing an increase in an asset, or a negative number representing a decrease in an asset. (Do not include the $ symbol in your answers.) f. If the desired reserve ratio for Bank 1 and all other banks is 4 percent, then the maximum new loan Bank 1 can create is $. (Enter your response as a whole number. Do not include the $ symbol in your answer.) g. What assets of Bank 1 will change when it approves this new loan? Complete the second column of the following table by in each row entering "0" if the listed item is not an asset and/or does not change, a positive number representing an increase in an asset, or a negative number representing a decrease in an asset. (Do not include the $ symbol in your answers.) h. The maximum change in the money supply the entire chartered banking system can create due to the Bank of Canada's purchase of the bonds is $ increase in the money supply or a negative number to represent a decrease in the money supply. Do not include the \$ symbol in your answer.) (Type a positive number to represent an
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