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multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are- no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 O Bank 3's Loans will increase by $640 O Bank 1's Loans will increase by $2.400 Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2,400

multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are- no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 O Bank 3's Loans will increase by $640 O Bank 1's Loans will increase by $2.400 Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2,400

ECON MACRO
ECON MACRO
5th Edition
ISBN:9781337000529
Author:William A. McEachern
Publisher:William A. McEachern
Chapter14: Banking And The Money Supply
Section: Chapter Questions
Problem 2.3P
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multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 O Bank 3's Loans will increase by $640 O Bank 1's Loans will increase by $2.400 O Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2,400 Bank 3's Reserves will increase by $960
Transcribed Image Text:multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 O Bank 3's Loans will increase by $640 O Bank 1's Loans will increase by $2.400 O Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2,400 Bank 3's Reserves will increase by $960
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