EBK THE ECONOMICS OF MONEY, BANKING AND
EBK THE ECONOMICS OF MONEY, BANKING AND
4th Edition
ISBN: 9780100668201
Author: Mishkin
Publisher: YUZU
Question
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Chapter 17, Problem 22AP
To determine

The reason for banking system not to be in equilibrium even though reserves in the system increase by $1 billion because FED lends $1 billion to financial institutions and checkable deposits increase by $9 billion, to determine what would happen in the system till equilibrium is reached and to show that the T-account for the banking system is in equilibrium.

ConceptIntroduction:

Checkable deposit −It refers to the demand deposit accounts against which drafts and checks can be issued. Checkable deposit accounts include savings accounts, checking accounts, money market accounts, negotiable draftsand checking accounts.

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