Start with the Wednesday balance sheet for The Friendly Bank on page 320 Suppose that, at the end of Wednesday, the Fed buys $100 in government bonds from a dealer with an account at the bank Otherwise, everyone behaves the same way as in the text Show the banks balance sheet, the monetary base, and the money supply for Thursday and Friday

Question: Start with the Wednesday balance sheet for The Friendly Bank on page 320. Suppose that, at the end of Wednesday, the Fed buys $100 in

Start with the Wednesday for The Friendly Bank on page 320. Suppose that, at the end of Wednesday, the Fed buys $100 in government bonds from a with an account at the bank. Otherwise, everyone behaves the same way as in the text. Show the bank’s the monetary base, and the money supply for Thursday and Friday.

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