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Changes in Monetary Policy
Prepare a 2-3 page analysis by answering the questions below. Be sure to cite your references using APA format.
Assume that the Bank of Ecoville has the following balance sheet and the Fed has a 10% reserve requirement in place:
Balance Sheet for Ecoville International Bank
ASSETS
LIABILITIES
Cash
$33,000
Demand Deposits
$99,000
Loans
66,000
Required:
Now assume that the Fed lowers the reserve requirement to 8%.
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