By how much will the money supply change

Assignment Help Econometrics

Reference no: EM13186445

The Federal Reserve has just purchased $100 million in Treasury bills from commercial banks.

b. If the public holds a fixed amount of currency (so that all loans create an equal amount of deposits in the banking system), the minimum reserve ratio is 5%, and banks hold no excess reserves, by how much will deposits in the commercial banks change?

c. By how much will the money supply change? Describe the final changes to the T-account for commercial banks when the money supply changes by this amount.

Reference no: EM13186445

Questions Cloud

State smaller dipole moment than formaldehyde : smaller dipole moment than formaldehyde, H2C=O, even though it contains electronegative chorine atoms in place of hydrogen. Explain

Find its book value after six years using the macrs method : An asset has an initial cost of $200,000, a salvage value of $25,000, and a recovery period of seven years. a. Find its book value after six years using the MACRS method. b. Find its book value after six years using the double declining balance metho..

Explain equilibrates at a partial pressure : the concentration of co2 in the soda is 0.14M. find the concentration of CO2 in the soda after the bottle is opened, and equilibrates at a partial pressure of 3.0 X 10^-4 atm. The henry's law constant is 3.4 X 10^-2 mol/L atm.

Explain what is the theoretical yield of hydrazine : What is the theoretical yield of hydrazine, in grams, prepared from the reaction of 150.0mL of 1.01 M NH3 (aq) with 50.0 mL of 1.25 M NaOCl (aq)?

By how much will the money supply change : The Federal Reserve has just purchased $100 million in Treasury bills from commercial banks. b. If the public holds a fixed amount of currency (so that all loans create an equal amount of deposits in the banking system), the minimum reserve ratio ..

State oxygen gas undergo an isothermal reversible : Calculate ?Ssys (in Joules) when 20.0 moles of oxygen gas undergo an isothermal reversible expansion from 30.0 L to 80.0 L.

What happens to output if govt purchases are increased : This question considers a closed economy Keynesian model that is augmented to include transfers payments to consumers (Tr = Transfers) that increase consumers' disposable incomes and lower government savings.Derive and calculate the Keynesian mult..

State what is the theoretical yield of hydrazine : What is the theoretical yield of hydrazine, in grams, prepared from the reaction of 125.0 mL of 0.500M NH3(aq) with 25.0mL of 1.70M NaOCl (aq)?

Find the total amount that shane will receive : Shane invests $38,000 in bonds that earn simple interest of 3%. The interest is payable at the maturity of the bonds after 5 years. Find the total amount that Shane will receive at the end of 5 years.

User Account

All Pages