(Table: National Banks) Assume that all banks follow the same required reserve ratio requirement. Also assume that the banks are listed in sequential order (thus the loans from The First National Bank become the deposits for the Second National Bank, and the loans from the Second National Bank become the deposits for the Third National Bank, and so on). Also, the banks' balance sheets must always be balanced. withdrawals, and thus each bank maintains 3 percent extra deposits as excess reserves over and above required reserves. What is the effective money multiplier now? c. What difficulty associated with monetary policy is illustrated by this question?
B.

Question

(Table: National Banks) Assume that all banks follow the same required reserve ratio requirement. Also assume that the banks are listed in sequential order (thus the loans from The First National Bank become the deposits for the Second National Bank, and the loans from the Second National Bank become the deposits for the Third National Bank, and so on). Also, the banks' balance sheets must always be balanced.  withdrawals, and thus each bank maintains 3 percent extra deposits as excess reserves over and above required reserves. What is the effective money multiplier now? c. What difficulty associated with monetary policy is illustrated by this question? 
B.

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The Answer of (Table: National Banks) Assume that all banks follow the same required reserve ratio requirement. Also assume that the banks are listed in sequential order (thus the loans from The First National Bank become the deposits for the Second National Bank, and the loans from the Second National Bank become the deposits for the Third National Bank, and so on). Also, the banks' balance sheets must always be balanced.  withdrawals, and thus each bank maintains 3 percent extra deposits as excess reserves over and above required reserves. What is the effective money multiplier now? c. What difficulty associated with monetary policy is illustrated by this question? 
B.

(Table: National Banks) Assume That All Banks Follow the Same