AaBbCcC AaBl AaBb(AaBbC . X2 A . & . A - A EX the 2 the 3 Q1 (20 marks). Could you tell how MI and M2 of the U.S. are to be affected by the following situations? 1.a (10 marks) A criminal gang forces into a U.S. bank's vault and takes $10 million of paper bills. 1.b (10 marks) The Federal Reserve spends $500 million to buy Treasury bills from JP Morgan Chase, a large bank. The bank in turn lent $300 million of the $500 million to a business company which put the $300 million as deposits in its checking account in JP Morgan Chase. Q2 (40 marks). 2.a (10 marks) Joe buys a house in California worth $1.5 million. Joe pays with half a million dollars in cash and the rest by borrowing a mortgage loan from bank. Joe is required to pay a monthly installment for 30 years. How much does Joe have to pay to the bank each month if Joe faces an annual mortgage loan rate of 6%. 2.b (10 marks) A U.S. investor purchased 100 ten-year bonds issued by a U.S. company on July 15th last year. Each of those bonds has a face value of $1000 and an annual coupon rate of 8%. The investor bought the bonds at a price of $900. What is the YTM of the bonds? 2.c (10 marks) Based on the settings in 2.b, suppose that this year the investor finds that the market price of the bond falls to $600 each. If the investor decides to sell the bonds on July 15th this year, what is the rate of return of this investment? 2.d (10 marks) Based on settings in 2.b and 2.c, suppose that between July 15th last year and the same date this year, inflation rate is at 5%. What is the real rate of return of this investment