A balance sheet for the central bank of Pecunia is shown below: Centra

A balance sheet for the central bank of Pecunia is shown below: Central Bank Balance Sheet Assets Liabilities Foreign assets $1,000 Deposits held by private banks $500 Domestic assets $1,500 Currency in circulation $2,000 Please write the

new balance sheet if the bank sells $100 worth of foreign bonds for domestic currency.

ANSWER

Central Bank Balance Sheet
Assets Liabilities
Foreign assets $900 Deposits held by private banks $500
Domestic assets $1,500 Currency in circulation $1,900