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TABLE C ASSETS LIABILITIES REQUIRED RESERVES $144,000 DEMAND DEPOSITS $3,600,000 EXCESS RESERVES ? TOTAL RESERVES $150,000...

TABLE C

ASSETS

LIABILITIES

REQUIRED RESERVES $144,000

DEMAND DEPOSITS $3,600,000

EXCESS RESERVES ?

TOTAL RESERVES $150,000

GOVT. SECURITIES $550,000

LOANS $2,900,000

TOTAL ASSETS $3,600,000

TOTAL LIABILITIES $3,600,000

Please complete Table C.

45. If the Fed purchases $50,000 in securities from the bank, the bank could lend out?

A) $50,000

B) $56,000

C) nothing it will have a reserve deficiency

D) $125,000

46.  If the Fed sells $50,000 in securities to this bank, the money supply will:

A) expand by $1,000,000

B) expand by $1,400,000

C) contract by $1,000,000

D) contract by $1,400,000

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