Homework Answers
M1 money supply includes currency (including coins ) in circulation, checkable deposits and travellers check.
So the banks deposit that are part of M1= currency+checkable deposits= 20+500= $520 million
M2 money supply in addition to M1 money supply includes saving deposits, time deposits, money market funds, certificates of deposits.
So the banks deposits that are part of M2 = M1+ saving deposits + small time deposits= $520+ $600+ $500 = $1620 million.
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The table gives information about items on a bank's balance sheet Item (millions of dollars) Calculate...
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The table shows the balance sheet of a banking system (aggregated over all the banks). The desired reserve ratio on all deposits is 1 percent. There is no currency drain. Calculate the bank's excess reserves. Assets Liabilities (millions of dollars) Reserves at the Fed 20 Checkable deposits Cash in vault Savings deposits Securities Loans 100 75 >>> Answer to 2 decimal places. The banking system's excess reserves are $ million
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flew by SAT 1 In the following bank balance sheet, amounts are in millions of dollars. The required reserve ratio is 4% on the first $30 million of checkable deposits and 14% on any checkable deposits over $30 million. Assets Liabilities Reserves $26.5 Checkable deposits $180.0 Loans $150 Net worth $20.0 Securities $23.5 Total $200 Total $200 a. Calculate the bank's excess reserves. Excess reserves are 5 million (Enter your response rounded to one decimal place.) b. Suppose that the...
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