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Question;ScenarioUse the following information to answer questions 8-10.This is the T-account for National Bank, the only commercial bank in the country. Thereserve requirement, set by the Federal Reserve, is currently 20%. Use this information toanswer the following questions.8.) Assume that the bank meets the reserve requirement but does not hold anyexcess reserves. What is the level of loans?a. $1,200,000b. $1,400,000c. $1,600,000d. $1,800,0009.) 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. $1,000,000b. $3,000,000c. $2,100,000d. $4,000,00010.) What is the size of the money multiplier?Answer


Paper#58116 | Written in 18-Jul-2015

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