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The government of Eastlandia uses measures of monetary aggregates similar to those used by the United States and the central bank of Eastlandia imposes a required reserve ratio of 10%. Given the following information, answer the questions below.
Bank deposits at the central bank (Eastlandia's Fed) = $200 million
Currency held by the public = $150 million
Currency in bank vaults = $100 million
Checkable bank deposits = $500 million
Travelers' checks = $10 million
a. M1 is $ __________ million.
b. The commercial banks are holding excess reserves of $ __________ million.
c. The commercial banks can potentially increase the money supply by $ __________ million.
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