Problem 3: Suppose that the T-account for the Bank X is as follows: Assets Reserves = $100000 Loans = $400000 Liabilities Deposits = $500000 1. If the Central Bank requires banks to hold 5% of deposits as reserves, how much in excess reserves does first bank now hold? 2. Assume that other banks hold only the required amount of reserves. If the Bank X decides to reduce its reserves to only the required amount, by how much would the economy's money supply increase