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Macroeconomics

13th Edition
Roger A. Arnold
Publisher: Cengage Learning
ISBN: 9781337617390

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BuyFindarrow_forward

Macroeconomics

13th Edition
Roger A. Arnold
Publisher: Cengage Learning
ISBN: 9781337617390
Chapter 13.3, Problem 3ST
Textbook Problem
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If Bank A borrows $10 million from Bank B, what happens to the reserves in Bank A? What happens in the banking system?

To determine

The changes in the banking system.

Explanation of Solution

When Bank A borrows $10 million from Bank B, the reserves of Bank A increase. However, this leads to a reduction in the reserves of Bank B, but the reserves in the en...

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