Balance sheet of the Summer bank Assets Liabilities Cash $ 8,000 Deposited with the Fed $ 6,000 Loans $ 116,000 Deposits $ 80,000 Capital $ 50,000 Total $ 130,000 Total $ 130,000 The required reserve ratio (RRR) on all deposits is 8% How much new amount of loan will this bank be able to create with the RRR of 5%?
Balance sheet of the Summer bank Assets Liabilities Cash $ 8,000 Deposited with the Fed $ 6,000 Loans $ 116,000 Deposits $ 80,000 Capital $ 50,000 Total $ 130,000 Total $ 130,000 The required reserve ratio (RRR) on all deposits is 8% How much new amount of loan will this bank be able to create with the RRR of 5%?
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter28: Monetary Policy And Bank Regulation
Section: Chapter Questions
Problem 39P: Suppose the Fed conducts an open market sale by selling $10 million in Treasury bonds to Acme Bank....
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Balance sheet of the Summer bank
Assets |
Liabilities |
Cash $ 8,000 Deposited with the Fed $ 6,000
Loans $ 116,000
|
Deposits $ 80,000
Capital $ 50,000 |
Total $ 130,000 |
Total $ 130,000 |
The
How much new amount of loan will this bank be able to create with the RRR of 5%?
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