Grower Sells No Seed

Grower Sells No Seed—Model #4

Disaster strikes.

Several months later the grower crop fails - A flood completely wipes out the grower's crop.

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Grower	Dealer	Bank	Money/Deposits
Sells no corn seed. Receives nothing.	Buys no seed from grower.	Not involved.	No change in quantity of money.
Account Balance: $0.00.	Account Balance: $3,250.	Account Balance: $1,250.	Total Money: $4,500. Deposit Liabilities: $4,500

Grower

Dealer

Bank

Money/Deposits

Sells no corn seed. Receives nothing.

Buys no seed from grower.

Not involved.

No change in quantity of money.

Account Balance:
$0.00.

Account Balance:
$3,250.

Account Balance:
$1,250.

Total Money: $4,500.

Deposit Liabilities: $4,500

So, what effect does the grower's default have on the bank and the quantity of money...