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Uppose that the Federal Reserve conducts open market operations by purchasing $1,000 worth of government securities from Bank A. As a result, Bank A finds itself with $1,000 in excess reserves that it lends out and those funds end up in Bank B. The loan made by Bank B ends up in Bank C, and the loan made by bank C ends up in Bank D. What dollar value goes in blanks (E) and (F), respectively?.
a. $729; $81
b. $81; $729
c. $10; $800
d. $700; $110
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Answers: 2
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Uppose that the Federal Reserve conducts open market operations by purchasing $1,000 worth of govern...
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