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The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Calculate the bank's excess reserves. >>> Answer to 2 decimal places. Assets Liabilities (millions of dollars) 25425 Reserves at the Fed 25 Cash in vault Securities Loans Checkable deposits Savings deposits 40 120 The banks' excess reserves are $11 million. If the banks use all of these excess reserves to make loans, what is the quantity of loans? The quantity of loans will be $11 million. If the banks use all of the excess reserves to make loans, what is the quantity of total deposits immediately after the banks have made the loans? 120 70

The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Calculate the bank's excess reserves. >>> Answer to 2 decimal places. Assets Liabilities (millions of dollars) 25425 Reserves at the Fed 25 Cash in vault Securities Loans Checkable deposits Savings deposits 40 120 The banks' excess reserves are $11 million. If the banks use all of these excess reserves to make loans, what is the quantity of loans? The quantity of loans will be $11 million. If the banks use all of the excess reserves to make loans, what is the quantity of total deposits immediately after the banks have made the loans? 120 70

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter21: The Monetary System
Section: Chapter Questions
Problem 12PA
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The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Calculate the bank's excess reserves. >>> Answer to 2 decimal places. The banks' excess reserves are $11 million. If the banks use all of these excess reserves to make loans, what is the quantity of loans? The quantity of loans will be $11 million. If the banks use all of the excess reserves to make loans, what is the quantity of total deposits immediately after the banks have made the loans? The quantity of total deposits immediately after the banks have made the loans is $ ☐ million. Assets Liabilities (millions of dollars) Reserves at the Fed 25 Checkable deposits 120 Cash in vault Securities Loans 5 Savings deposits 70 40 120
Transcribed Image Text:The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Calculate the bank's excess reserves. >>> Answer to 2 decimal places. The banks' excess reserves are $11 million. If the banks use all of these excess reserves to make loans, what is the quantity of loans? The quantity of loans will be $11 million. If the banks use all of the excess reserves to make loans, what is the quantity of total deposits immediately after the banks have made the loans? The quantity of total deposits immediately after the banks have made the loans is $ ☐ million. Assets Liabilities (millions of dollars) Reserves at the Fed 25 Checkable deposits 120 Cash in vault Securities Loans 5 Savings deposits 70 40 120
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