yellowfish352

A bank has $400 million in checkable deposits,$700 million in savings deposits ; $400 million in small
time deposits, $900 million in loans to Businesses, $550 million in government securities, $20 million in
currency and $30 million in its reserve account at the Fed.
1) Set up the balance sheet of the bank .
2) What are the bank’s loans, securities and reserves .
3) calculate both the reserve requirement ratio and the desired requirement ratio .
4) calculate money multiplier assuming that there is no currency drain .
5) How much money will be created through the banking system?