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Question 1

Consider the following balance sheet for PNC.

AssetsLiabilities
Reserves731Deposits1700
Loans969

Suppose that PNC is a typical bank and keeps only the required reserves. Given this data, what is the money multiplier?

Hint

Question 2

Consider the following balance sheet for Capital One.

AssetsLiabilities
Reserves300Deposits1200
Loans900

Suppose that Capital One is a typical bank and keeps only the required reserves. In addition, suppose that someone deposited $300.

Given this data, what is the total change in the M1 Money Supply?

Hint

Question 3

Consider the following balance sheet for Bank of America.

AssetsLiabilities
Reserves850Deposits1700
Loans850

Suppose that someone deposited $400 at Bank of America.

Given this data, what is the maximum amount by which the money supply will increase?

Hint