Balance sheet (personal)

Assets Liabilities and Net worth

Car 20000 Car loan 15000
house 50000 Mortgage 49000
Deposit 80000 Net worth 16000
64000 Liability
80000 L+NW

BS (bank) stage 1
Assets Liabilities
RR 10000 Deposit 100000 RRR=10%
Excess reserves 90000
100000 100000

stage 2
Assets Liabilities
RR 10000 Deposit 100000 ER can be used by bank, specific
Excess reserves
(loans ) 90000 for loans
100000 100000

stage 3 +10000
Assets Liabilities
RR 11000 Deposit 110000
Excess reserves 99000
110000 110000

stage 3: -5000
Assets Liabilities
RR 10500 Deposit 105000
Excess reserves
(loans) 94500
100000 105000

net worth - the investments of the bank owners

can be used by bank, specifically
 RRR=10%
Bank 1 Bank 2
A L A L
RR 10 D 100 RR 9 D90
ER (loans) 90 Loan 81
Dana outs 90 Usd in another bank Tamer 81

MS=90+81+74+65…... 100*1/0.1 = 1000

Money multiplier = 1/RRR is 10

Increase in MS = change in the monetary base * MM

Bank 2
A L
RR 8.1 D 81
Loan 72.9
Tamer 81