(solution) Hi there, i need assistance with answering this question these

(solution) Hi there, i need assistance with answering this question these

Hi there, i need assistance with answering this question these questions (macro-economics)

1) You have decided to deposit $2,000 in a savings account in the Commonwealth Bank, which
does not have any excess reserves at the time when you make a deposit.
a) How does your deposit change the Bank?s T-account? Show the T-account changes. (1
mark) b) Now the Bank is told to maintain a reserve ratio of 0.2 (ie, 20 percent). The Bank decides
to make the maximum possible loan from the deposited funds. Following from the Taccount in Part a), what does the T-account look like now? (1 mark) c) Now, somebody who took out the loan in Part b) writes a cheque for the amount and then
the person receiving the cheque deposits it in WestPac Bank which also maintains a
reserve ratio of 0.2. Show how this changes the T-account of WestPac Bank. (1 mark) d) If the process of money creation continues what is the total money supply resulting from
your initial $2,000 deposit? (1 mark)