Answer Happy

Philippines Central Bank (BSP) plans to increase the Required Reserve Ratio (RRR) of banks from 2% to 3% in July 2021. Reserves by banks in BSP=100, Gov't securities of BSP=400. Loans to Bank. You may use T1&T2 below to facilitate your problem solving T1 Required Reserve Ratio 0.02 (PHP Billion) BSP Balance Sheet ASSETS Govt'Securities Loans to banks LIABILITIES Reserves Cash BSP ASSETS Govt'Securities 400 Money Multiplier T2 Required Reserve Ratio Loans to banks 100 100 ? 400 100 COMM'L BANKS' Balance Sheet ASSETS Reserves Loans LIABILITIES Deposits Loans owed to BSP (M1-Cash+deposit) 0.03 (PHP Billion) COMM'L BAMKS ASSETS Reserves Loans ? 2.

Loans to banks LIABILITIES Reserves Cash 100 100 Loans ? LIABILITIES Deposits Loans owed to BSP Money Multiplier (M1-Cash+deposit) Given RRR = .02, how many times will deposit in banks be compared to Reserves? [Select] Given RRR = .02, how much loans, in pesos, can the banks extend to their borrowers? [Select] Given RRR =.02, BSP plans to reduce loans to banks to PHP50 billion. How much loans can bank extend? [Select] ? When RRR is increased from 2% to 3%, what is the effect on M1? [ Select]