Consider the information in the previous question. Start with the M1 and M2 amounts you calculated in that question (after the loan was made to Anna). Anna uses that $50,000 to buy herself a nice little piece of land in the countryside. Anna pays for this land by writing a check on her Bank A checking account and giving it to the seller of the land. The seller deposits the check in his savings account at Bank B. After this transaction is completed (money is transferred from Bank A to Bank B), the M1 money supply will equal dollars and the M2 money supply will equal dollars. Use the Fed's rule after May 2020. Bank A Balance Sheet Assets Liabilities and Net Worth Uses of Funds Sources of Funds Reserves $65,000 Deposits Demand Deposits Savings Deposits Small Time Deposits Large Time Deposits $150,000 $750,000 $250,000 $500,000 Treasury Bonds $85,000 Borrowing From the Fed From the Fed Funds Market $50,000 $100,000 Loans Total $1,850,000 Net Worth $2,000,000 Total $200,000 $2,000,000 Bank B Balance Sheet Assets Liabilities and Net Worth Uses of Funds Sources of Funds Reserves $10,000 Deposits Demand Deposits Savings Deposits Small Time Deposits Large Time Deposits $100,000 $700,000 $240,000 $650,000 Treasury Bonds $40,000 Borrowing From the Fed From the Fed Funds Market $0 $30,000 Loans Total $1,900,000 Net Worth $1,950,000 Total $230,000 $1,950,000