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For the last time, consider an economy described by the following information: Demand deposits total $200,000 • Cash in bank vaults totals $50,000 The public holds cash of $36,000 US government bonds held by banks total $6,000 Banks' deposits in the Fed total $22,000 Let's say that one bank in the economy has $60 in excess reserves and that there are enough banks in tosal for the full multiplied money creation process to take place. Calculate the amount (the actual amount, not the maximum) that the entire banking system -- all banks working together -- will create in new money, using these ER as your starting point. Carefully follow all numeric directions, including those related to rounding.

For the last time, consider an economy described by the following information: Demand deposits total $200,000 • Cash in bank vaults totals $50,000 The public holds cash of $36,000 US government bonds held by banks total $6,000 Banks' deposits in the Fed total $22,000 Let's say that one bank in the economy has $60 in excess reserves and that there are enough banks in tosal for the full multiplied money creation process to take place. Calculate the amount (the actual amount, not the maximum) that the entire banking system -- all banks working together -- will create in new money, using these ER as your starting point. Carefully follow all numeric directions, including those related to rounding.

Macroeconomics: Private and Public Choice (MindTap Course List)
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter13: Money And The Banking System
Section: Chapter Questions
Problem 17CQ
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For the last time, consider an economy described by the following information: Demand deposits total $200,000 Cash in bank vaults totals $50,000 • The public holds cash of $36,000 US government bonds held by banks total $6,000 Banks' deposits in the Fed total $22,000 Let's say that one bank in the economy has $60 in excess reserves and that there are enough banks in tesal for the full multiplied money creation process to take place. Calculate the amount (the actual amount, not the maximum) that the entire banking system -- all banks working together -- will create in new money, using these ER as your starting point. Carefully follow all numeric directions, including those related to rounding.
Transcribed Image Text:For the last time, consider an economy described by the following information: Demand deposits total $200,000 Cash in bank vaults totals $50,000 • The public holds cash of $36,000 US government bonds held by banks total $6,000 Banks' deposits in the Fed total $22,000 Let's say that one bank in the economy has $60 in excess reserves and that there are enough banks in tesal for the full multiplied money creation process to take place. Calculate the amount (the actual amount, not the maximum) that the entire banking system -- all banks working together -- will create in new money, using these ER as your starting point. Carefully follow all numeric directions, including those related to rounding.
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