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Use the following information to answer questions 4 through 6: Consider the following balance sheet for TD. Assets Liabilities Reserves 493 Deposits 2900 Loans 2407

Use the following information to answer questions 4 through 6:

Consider the following balance sheet for TD.

Assets Liabilities

Reserves 493 Deposits 2900

Loans 2407

1.Suppose that TD is a typical bank and keeps only the required reserves. Given this data, what is the money multiplier?

The money multiplier is 5.882352941.

2.Suppose that TD is a typical bank and keeps only the required reserves. In addition, suppose that someone deposited $700. Given this data, what is the total change in the M1 Money Supply?

3.Suppose that someone deposited $700 at TD Bank. Given this data, what is the minimum amount by which the money supply will increase?

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