Tracy Williams deposits $500 that was in her sock drawer into a checking account at the local bank. a. How does the deposit initially change the T-account of the local bank? How does it change the money supply? b. If the bank maintains a reserve ratio of 10%, how will it respond to the new deposit?

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A: The following problem has been solved as follows:

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A:

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A:

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A: Money Created = Multplier*Amount of Money aadded Multiplier =  1/reserve ratio = 1/20 = 5

Q: Which definition of the money supply includes credit cards?

A: To answer this question, we have to look at the various measures of money supply.

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Q: The task I am struggling with: Tracy Williams deposits $500 that was in her sock drawer into a…

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A: The sum of banking reserves and the currency in circulation referred to as high-powered money.

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A: Given: Deposit amount =$2000 Reserve ratio = 10% =0.1 Bank's lending amount = $1500

Q: 5. Tracy Williams deposits $500 that was in her sock drawer into a checking account at the local…

A: please find the answer below.

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A: Required reserve = 14% Excess reserves= $1000 Change in money = money multiplier* excess reserves