Bank A has checkable deposits of $140 million, vault cash equaling $1 million and deposits at the Fed equaling $14 million. If the required reserve rate is ten percent what is the amount of excess reserves Bank A is holding?
A. $2 million
B. $1 million
C. It does not have any excess reserves
D. $15 million
Answer: B
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Refer to the figure above. What is the maximum possible social surplus?
A) $100 B) $150 C) $225 D) $375
Why do some firms practice price discrimination? Relate your answer to the common practice of public colleges charging lower tuition to in-state students and higher tuition to out-of-state students
What will be an ideal response?
Shortage means the same thing as scarcity
Indicate whether the statement is true or false
Suppose a monopoly firm has an annual demand function of Qd = 20,000 - 250P, annual variable costs of VC = 16Q + 0.002Q2 and marginal cost of MC = 16 + 0.004Q, where Q is the annual quantity of output. In addition, the firm has an avoidable fixed cost of $25,000 per year. If this firm maximizes its profit, what is the value of the consumer surplus in the market?
A. $121,000 B. $60,500 C. $136,125 D. $0