Use the following balance sheets for the RBA, NAB and Westpac to illustrate effects of the following transactions. Use a plus (+) to denote inflows and a minus (-) to denote outflows Edit:

The answer section below each question is to describe the effects of the transaction towards the amount of ESA after each transactions. The balance sheet in the end is supposed to reflect the total changes in the account of each bank after all three transactions, a (+) i sign is used when there is an inflow into the account after all three transactions and a (-) sign is used when there is an outflow from the account after all three transactions.

2.1 The Federal Government deposits $200 million in pension payments into the accounts of NAB customers. What has happened to the amount of ESA funds ("cash) in the system? Answer: 2.2 Westpac sells $200 million worth of securities to NAB. What has happened to the amount of ESA funds ("cash) in the system? Answer: 2.3 The RBA sells $200 million worth of securities to Westpac. What has happened to the amount of ESA funds ("cash) in the system? Answer: Westpac Assets ($ m Liabilities ($ m) NAB Liabilities ($ m) Assets ($ m ESA Deposits ESA Deposits Loans Loans Securities Securities RBA Liabilities ($ m) Assets ($ m Securities ESA (NAB) ESA (Westpac Gov. Account