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When the discount window of cb

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1. Discuss what happens to Rs or Rd when the discount window of CB is not open for lending. Rs: supply of reserves, Rd: demand for reserves , DL: discount loans

2. Draw the case where the interbank rate is equal to the discount rate and DL=0. Show what happens to Rs, Rd, Rn, DL, , , when required reserve ratio falls.

Reference no: EM131523655

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