Suppose Chemical Bank makes a loan of $100,000 to Al. Al uses the loan to buy a house from Bob, and Bob deposits Al’s check into his account at Citibank. Show what happens at each stage of this process to the deposit liabilities and the reserve of each of the two banks.

Answer rating: 100% (QA)

Lets break down the process into stages 1 Chemical Bank Issues a Loan Chemical Bank extends a loan o... View the full answer