Suppose the Second National Bank has the following simplified balance sheet.The reserve ratio is 25% and all dollar figures are in thousands. 
Assume that households and businesses deposit $10 in this bank and that this currency is added to the bank's reserves.(a) In column (1) show the bank's balance sheet after this occurs.Is there a change in the money supply?
(b) In column (2) show what would happen if the bank now loans all of its excess reserves to a depositor.Is there a change in the money supply?
Definitions:
Classroom Inequalities
The disparities in educational resources, opportunities, and treatment that students experience within and across classrooms, often based on socioeconomic status, race, gender, and other factors.
Power Relations
The dynamics of power between individuals, groups, or institutions within a society, determining how power is distributed, exercised, and resisted.
Dominant Society's
Reflective of the culture, values, and practices of the society's ruling class or majority group.
Institutional Beliefs
Deeply ingrained convictions or ideologies held and propagated by an institution, which shape its policies, culture, and practices.
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