If a bank has $1,000,000 in reserves and checking deposits of $3,000,000 . what is the bank's reserve position if the required reserve ratio is 20 percent?
a. The bank has $500,000 of required reserves and $500,000 of excess reserves.
b. The bank has $600,000 of required reserves and $400,000 of excess reserves.
c. The bank has $400,000 of required reserves and $600,000 of excess reserves.
d. The bank has $200,000 of required reserves and $800,000 of excess reserves.
b
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The function of money that helps assess the opportunity cost of an activity is money's use as a
A) barter tool. B) store of value. C) medium of exchange. D) store of debt. E) unit of account.
Consumers are often somewhat insensitive to changes in the price of table salt because
A) the proportion of their budget spent on salt is very low. B) there are a considerable number of good substitutes for salt, in their opinion. C) they are not used to changes in the price of salt. D) salt is a necessity for a complete dining experience. E) all of the above reasons.
Explain the difference between actual output and potential output. What does the difference between these variables represent?
What will be an ideal response?
While a trade-off between inflation and unemployment may exist when people expect no inflation, when they realize inflation is occurring, what happens?
a. The trade-off increases. b. The trade-off decreases. c. The trade-off disappears. d. The trade-off shifts.