6. The following T-account shows the assets and liabilities of all banks in Canada. The reserve...

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6. The following T-account shows the assets and liabilities of all banks in Canada. The reserve ratio is 10%. All financial transactions occur within the banking system. No one holds cash. Assets Actual reserves Loans Bonds Required Reserves:_ Excess Reserves:_ Liabilities Deposits $300 million $1500 million $700 million a) What is the amount of total desired reserves? What is the amount of excess reserves? $2500 million Change in MS_ b) What will be the final T-account after all of the excess reserves are loaned out? Assets Liabilities Deposits Actual reserves Loans Bonds c) After all the multiplier processes have taken place, what will be the change in money supply? 7 4 6. The following T-account shows the assets and liabilities of all banks in Canada. The reserve ratio is 10%. All financial transactions occur within the banking system. No one holds cash. Assets Actual reserves Loans Bonds Required Reserves:_ Excess Reserves:_ Liabilities Deposits $300 million $1500 million $700 million a) What is the amount of total desired reserves? What is the amount of excess reserves? $2500 million Change in MS_ b) What will be the final T-account after all of the excess reserves are loaned out? Assets Liabilities Deposits Actual reserves Loans Bonds c) After all the multiplier processes have taken place, what will be the change in money supply? 7 4

Answer rating: 100% (QA)

a Figures are in million dollar Desired reserve Deposits Required reserve r... View the full answer