Question Scenario Use the following information to answer questions 8-10. This is the T-account for National Bank the only commercial bank in the country. The reserve requirement set by the Federal Reserve is currently 20%. Use this information to answer the following questions. 8.) Assume that the bank meets the reserve requirement but does not hold any excess reserves. What is the level of loans? a. $1200000 b. $1400000 c. $1600000 d. $1800000 9.) The Federal Reserve buys $100000 worth of bonds in open-market operations. Assume that all funds are deposited into accounts at National Bank. What is the new level of deposits? a. $1000000 b. $3000000 c. $2100000 d. $4000000 10.) What is the size of the money multiplier? Answer: _________________

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