Chambers Kelly
05/17/2024 · Senior High School
Suppose the Fed requires banks to hold 9 percent of their deposits as reserves. A bank has \( \$ 18,000 \) of excess reserves and then sells the Fed a Treasury bill for \( \$ 9,000 \). How much does this bank now have available to lend out if it decides to hold only required reserves?
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The bank has $18,000 available to lend out.
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