There is three questions attached that I need help with.
Question 1:
Assume that the following data characterize the hypothetical economy of Trance: money supply = $180 billion; quantity of money demanded for transactions = $160 billion; quantity of money demanded as an asset = $10 billion at 12 percent interest, increasing by $10 billion for each 2percentagepoint fall in the interest rate. a. What is the equilibrium interest rate in Trance? |:| % b. At the equilibrium interest rate, what are the quantity of money supplied, the total quantity of money demanded, the amount of money demanded for transactions, and the amount of money demanded as an asset in Trance? Instructions: Enter only whole numbers for your answers below. Quantity of money supplied = $ |:| Quantity of money demanded = $ Amount of money demanded for transactions = $ Amount of money demanded as an asset = $ Suppose Yukon Bank has the following simplied balance sheet and that the desired reserve ratio is 20 percent. Instructions: All answers to this question should be entered as whole numbers. Liabilities and net worth (1') Cash reserves $22 , 000 $ $ Securities 38, 000 $ Loans 40 , 000 $ $ Deposits $100,000 a. What is the maximum amount of new loans Yukon Bank can make? 55 |:| Show in columns 1 and 1' how the bank's balance sheet will appear afterthe bank has loaned this additional amount. b. By how much has the supply of money changed? $|:| c. How will the bank's balance sheet appear after cheques drawn for the entire amount of the new loans have been cleared against this bank? Show this new balance sheet in column 2 and 2'. d. Answer parts (a), (b), and (c) on the assumption that the desired reserve ratio is 15 percent. What is the maximum amount of new loans Yukon Bank can make? $|:| Show in columns 3 and 3' (below) how the bank's balance sheet will appear after the bank has loaned this additional amount. By how much has the supply of money changed? $E Liabilities and net worth (3') Cash reserves $22,000 $100,000 Securities 38,000 $ $ Loans 40,000 $ $ Deposits How will the bank's balance sheet appear after cheques drawn for the entire amount of the new loans have been cleared against this bank? Show this new balance sheet in column 4 and 4' in the table above