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economics!!!!!!!!!!!!!!

Question # 00000831
Subject: Economics
Due on: 09/10/2013
Posted On: 09/08/2013 11:03 AM

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Question
Scenario
Use the following information to answer questions 8-10.
This is the T-account for National Bank, the only commercial bank in the country. The
reserve requirement, set by the Federal Reserve, is currently 20%. Use this information to
answer the following questions.

8.) Assume that the bank meets the reserve requirement but does not hold any
excess reserves. What is the level of loans?
a. $1,200,000
b. $1,400,000
c. $1,600,000
d. $1,800,000
9.) The Federal Reserve buys $100,000 worth of bonds in open-market operations.
Assume that all funds are deposited into accounts at National Bank.
What is the new level of deposits?
a. $1,000,000
b. $3,000,000
c. $2,100,000
d. $4,000,000
10.) What is the size of the money multiplier?
Answer: _________________

Tags economics bank reserve 0 worth buys federal bonds 1 openmarket 3000000d 4000000answer depositsb level operationswhat 1200000c hold country theanswer commercial national taccount following questions8 does scenariothis requirement meets aume anya

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economics!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

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Posted On: 09/08/2013 11:04 AM
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Tutorial Preview …of xxxxxxx $1,200,000b xxxxxxxxxxx $1,600,000 [Reserves x 0 2*2,000,000 xxxxxxxxx Also, xxxxxxx xxxxxxxxxxxx i x Reserves + xxxxx = Deposits xxxxx Loans=Deposits xxxx xxxxxxxx = xxxxxxxxxxxx $1,800,0009 ) xxx Federal Reserve…
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