For each of the following calculate: 1) the change in reserves; 2) the change in demand deposits; an… Show more For each of the following calculate: 1) the change in reserves; 2) the change in demand deposits; and 3) the change in M1 The Federal Reserve sells 100 in T-Bills to U.S. security firms. Some individual banks borrow 50 from the Federal Reserve. Some banks lend 25 to other banks in the Fed Funds market. The Treasury sells 45 of T-Notes to Chinese investors and spends the proceeds on wars somewhere. The Fed flies out a student in 305 for a job interview. The cost to the Fed is 15. Write your answers in the space provided below Reserves ΔDD ΔM1 A. B. C. D. E. Assume a legal reserve ratio of 10%, a currency drain of 40%. Ignore the excess reserve drain and sweep accounts. Show formulas used in answering this question. • Show less