Question: please show all work Through its open market operations, the Federal Reserve recently increased deposits at financial institutions by $90 billion. If the reserve requirement

please show all work please show all work Through its open market operations, the Federal

Through its open market operations, the Federal Reserve recently increased deposits at financial institutions by $90 billion. If the reserve requirement for all deposits is 10 percent, what is the maximum effect that the Fed's actions can have on total deposits? The real risk-free rate, r". is 2.5%. Inflation premium is expected to be 3% a year. Assume that there is no maturity risk premium. An 8-year corporate bond has a yield of 7.8%, which includes a liquidity premium of 0.8%. What is its default risk premium

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