Suppose al has a checking account in bank a and bob has a


Suppose Al has a checking account in Bank A, and Bob has a checking account in Bank B. Banks A and B each have $100,000 in deposit liabilities and $30,000 in reserves, and the required reserve ratio is 20%. Show what happens to each bank's deposit liabilities, reserves, and excess reserves if Al writes a check for $10,000 to Bob, Bob deposits the check into his account at Bank B, and Bank B collects from Bank A.

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Econometrics: Suppose al has a checking account in bank a and bob has a
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