The following is the balance sheet of First National Bank of Georgia.

Assets	Liabilities and Equities
Reserves	$400	Demand deposits	$4,000
Loans	$3,600	Equity (net worth)	$1000

Assume that the required reserve ratio is 10 percent.

(a) What is the dollar value of new loans that First National Bank of GA can make? Explain.

(b) Mrs. Mann deposits $200 in cash in a demand deposit account in First National Bank. Calculate the maximum amount of new loans that First National Bank can now make.

(c) As a result of Mrs. Mann's $200 cash deposit, calculate the maximum change over time in each of the following in the banking system.

(i) Loans

(ii) Demand deposits

(d) As a result of Mrs. Mann's $200 cash deposit, calculate the maximum change over time in the money supply.

(e) Provide one reason why the actual change in the money supply can be smaller than the maximum change you identified in part (d).