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Saved Help Save The FOMC has instructed the FRBNY Trading Desk to purchase $430 million...

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Saved Help Save The FOMC has instructed the FRBNY Trading Desk to purchase $430 million in U.S. Treasury securities. The Federal Reserve has currently set the reserve requirement at 10 percent of transaction deposits. Assume U.S. banks withdraw all excess reserves and give out loans a. Assume also that borrowers eventually return all of these funds to their banks in the form of transaction deposits. What is the full effect of this purchase on bank deposits and the money supply? b. What is the full effect of this purchase on bank deposits and the money supply if borrowers return only 90 percent of these funds to their banks in the form of transaction deposits? (For all requirements, enter your answers in billions. Round your final answers to 2 decimal places. (.e., 5,500,000,000 should be entered as 5.50).) ase in bank deposits and money supply bilion You have discovered that when the required rate of return on a bond you own fell by 0.5 percent from 9.3 percent to 8.8 percent, the fair present value rose from $965 to $975. The bond pays interest annually. What is the duration of this bond? Assume annual payments. (Do not round intermediate calculations. Round your answer to 1 decimal place. (e.g., 32.1)) Duration of this bond years

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