Meditorian Banking Statistics
The monetary policy of Meditor is determined by the Meditorian Central Bank. The local currency is the medit. Meditorian banks collectively hold 100 million medits of required reserves, 25 million medits of excess reserves, 250 million medits of Meditorian Treasury Bonds, and their customers hold 1,000 million medits of deposits. Meditorians prefer to use only demand deposits and so all currency is on deposit at the bank.
-Refer to Meditorian Central Banking.Assuming the only other thing Meditorian banks have on their balance sheets is loans,what is the value of existing loans made by Meditorian banks?

Question

Quizplus · Accepted Answer

The total deposits are 1,000 million medits. Required reserves are 100 million medits, and excess reserves are 25 million medits. Treasury Bonds are 250 million medits. Therefore, loans = total deposits - (required reserves + excess reserves + Treasury Bonds) = 1,000 - (100 + 25 + 250) = 625 million medits.

Meditorian Banking Statistics The Monetary Policy of Meditor Is Determined by the Meditorian