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Suppose the reserve requirement is 10%, banks hold no excess reserves, and there are no additional currency holdings. FInd the change In deposits, reserves, and
Suppose the reserve requirement is 10%, banks hold no excess reserves, and there are no additional currency holdings. FInd the change In deposits, reserves, and loans for each bank in the following scenario. Instructions: Round your answers to two decimal places. a. Henry recelves a check for $12,000 from selling his car and deposits the check into Tennessee Bank. Use the table below to show the change in assets and llabilitles at Tennessee Bank resulting from this transaction. b. Suppose that Julle gets a loan from Tennessee Bank in the amount from the "Loans" cell in the table In part a, and uses It to buy some tools from Todd. Todd deposits the money from Julle Into Kentucky Bank. Use the table below to show the change in assets and llabilitles at Kentucky Bank resulting from this transaction. c. Now suppose that Sue gets a loan from Kentucky Bank in the amount from the "Loans" cell In the table in part b, and buys some furniture from Jerry with the money. Jerry takes the money from the furniture and deposits it Into Indlana Bank. Use the table below to show the change in assets and llabilitles at Indlana Bank resulting from this transaction. d. How much total money will exist in this scenario given the three balance sheet changes above
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