What will have happened to the level of checkable deposits?.
Show more Assume that the required reserve ratio on checkable deposits is 10% banks do not hold any excess reserves and the publics holdings of currency do not change. If the Fed reduces reserves by selling $5 million worth of bonds to the banks what will the T-account of the banking system look like when the banking system is in equilibrium? What will have happened to the level of checkable deposits? A. Checkable deposits fall by $50 million and the T-account is: Banking System Assets Liabilities Reserves minus$5 million Checkable deposits minus$50 million Securities plus+$5 million Loans minus$5 million B. Checkable deposits fall by $5 million and the T-account is: Banking System Assets Liabilities Reserves minus$5 million Checkable deposits minus$5 million Securities plus+$5 million Loans minus$5 million C. Checkable deposits fall by $50 million and the T-account is: Banking System Assets Liabilities Reserves minus$5 million Checkable deposits minus$50 million Securities plus+$5 million Loans minus$50 million D. Checkable deposits fall by $5 million and the T-account is: Banking System Assets Liabilities Reserves minus$5 million Checkable deposits minus$5 million Securities plus+$5 million Loans minus$50 million Show less
What will have happened to the level of checkable deposits?
