Question: SA 1B- Central Bank Policy Continuing from part A. Suppose the required reserve ratio is 0 and that First National Bank plans to not have

SA 1B- Central Bank Policy

Continuing from part A.

Suppose the required reserve ratio is 0 and that First National Bank plans to not have any excess reserves. If First National bank wants to lend as much as possible, how will its balance sheet change? What is the change in the money supply?

Please answer with explanation

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