Question 2. (3 pts each) For each statement below, answer whether the statement is true or false. Briey explain your answer. (1) In the Free Banking era, banks put up collateral for its operation. (2) The stock of M1 in the economy goes to innity if the reserve requirement ratio goes to zero. (3) In the Free Banking era, an important cause of bank runs was that some states defaulted on their bonds. (4) The Federal Reserve system was created under the National Banking Act. (5) Demand deposits are a bank's assets. (6) Without the Federal Reserve system, private banks would still be able to help each other in a time of a bank run. (7) Checking accounts were invented after the Great Depression. (8) On a bank's balance sheet, assets can exceed liabilities. (9) When a private bank A sells Fed funds to another private bank B in the overnight market at a positive interest rate, both sides of bank A's balance sheet change. (10) Since the money stock M1 is the sum of the nonbank public's cash holdings and demand deposits, putting some of the cash into a checking account does not change M1