The president of Pacifica is concerned about the effect of this new investment expenditure on the economy, and she wishes to use monetary policy to move equilibrium GDP back toward potential GDP. (For the remainder of the question, assume that the Pacifica Central Bank is Pacifica's version of the United States Federal Reserve, that Pacifica's banking and financial systems work exactly like the United States. banking and financial systems, and that Pacifica's currency is called the Pacifica dollar (PS).) c. Which one of the following policies would help the president achieve her aim? i Direct the Pacifica Central Bank to purchase Psi million of Pacifica Treasury Bills ii. Direct the Pacifica Central Bank to sell P$1 million of Pacifica Treasury Bills d. The figure below depicts 2 T-accounts: one for all of the commercial banks in Pacifica, and one for the Pacifica Central Bank. Show the impact of the open market operation you chose in part (c) by indicating how much each of the entries in the light-blue shaded cells will change as a result of the open market operation. Type your answer directly into the cell, next to the item name. (So, you will be adding a number and a sign. For example if you want to indicate that the item in the cell would increase by 50, type "450" in the cell after its name. If you want to indicate it would decrease by So, type "50". If you want to indicate it won't change, type "O". If you do not enter any number into a cell it will be interpreted as a non-answer.) COMMERCIAL BANKS Assets Liabilities Treasury Bills PACIFICA CENTRAL BANK Assets Liabilities Treasury Bills Monetary Base Reserves The president of Pacifica is concerned about the effect of this new investment expenditure on the economy, and she wishes to use monetary policy to move equilibrium GDP back toward potential GDP. (For the remainder of the question, assume that the Pacifica Central Bank is Pacifica's version of the United States Federal Reserve, that Pacifica's banking and financial systems work exactly like the United States. banking and financial systems, and that Pacifica's currency is called the Pacifica dollar (PS).) c. Which one of the following policies would help the president achieve her aim? i Direct the Pacifica Central Bank to purchase Psi million of Pacifica Treasury Bills ii. Direct the Pacifica Central Bank to sell P$1 million of Pacifica Treasury Bills d. The figure below depicts 2 T-accounts: one for all of the commercial banks in Pacifica, and one for the Pacifica Central Bank. Show the impact of the open market operation you chose in part (c) by indicating how much each of the entries in the light-blue shaded cells will change as a result of the open market operation. Type your answer directly into the cell, next to the item name. (So, you will be adding a number and a sign. For example if you want to indicate that the item in the cell would increase by 50, type "450" in the cell after its name. If you want to indicate it would decrease by So, type "50". If you want to indicate it won't change, type "O". If you do not enter any number into a cell it will be interpreted as a non-answer.) COMMERCIAL BANKS Assets Liabilities Treasury Bills PACIFICA CENTRAL BANK Assets Liabilities Treasury Bills Monetary Base Reserves