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Business, 13.07.2020 22:01 aminak185

Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserve ratio is 20%. Paolo, a client of First Main Street Bank, deposits $750,000 into his checking account at First Main Street Bank. a. Complete the following table to reflect any changes in First Main Street Bank's T-account (before the bank makes any new loans).

Assets Liabilities

b. Complete the following table to show the effect of a new deposit on excess and required reserves when the required reserve ratio is 20%.

(Dollars) (Dollars) (Dollars)
750,000

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