A Balance Sheet for the Central Bank of Pecunia Is

question 7

Essay

A balance sheet for the central bank of Pecunia is shown below:
Central Bank Balance Sheet
AssetsLiabilities
Foreign assets $1,000Deposits held by private banks $500
Domestic assets $1,500Currency in circulation$2,000
Please write the new balance sheet if the bank makes a sterilized transaction by selling $100 of foreign assets for domestic currency and then purchasing $100 of domestic assets by writing a check on itself.

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