Assume the Required Reserve Ratio is 20% for all banks.If Rob, a Third National Bank customer, writes a check for $100,000 to Darrin, a First National Bank Customer, who deposits the check in full into his checking account, then what impact has the transaction had on the loan creating potential of the banking system (these three banks)? First National BankAssetsLiabilities and Net WorthUS Treasury BondsReserves (Cash)$450,000$175,000$125,000Net Worth$500,000Checkable Deposits$250,000LoansSecond National BankAssetsLiabilities and Net WorthProperty (Capital)Reserves (Cash)$100,000$250,000Net Worth$250,000$100,000Checkable DepositsThird National BankAssetsLiabilities and Net WorthUS Treasury BondsReserves (Cash)$900,000$350,000Net Worth$1,000,000$500,000Checkable DepositsLoans$250,000

A checkable deposit account measures checks, savings, and allows the consumer to access the account…

Assume the Required Reserve Ratio is 20% for all banks. If Rob, a Third National Bank customer, writes a check for $100,000 to Darrin, a First National Bank Customer, who deposits the check in full into his checking account, then what impact has the transaction had on the loan creating potential of the banking system (these three banks)?

Assume the Required Reserve Ratio is 20% for all banks. If Rob, a Third National Bank customer, writes a check for $100,000 to Darrin, a First National Bank Customer, who deposits the check in full into his checking account, then what impact has the transaction had on the loan creating potential of the banking system (these three banks)?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter16: Information, Risk, And Insurance

Section: Chapter Questions

Problem 8RQ: What are some ways that someone looking for a loan might reassure a bank that is faced with...

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