Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Suppose that $10,000 in new deposits is received by the bank in the above table. If there were no 70 other changes in the balance
Suppose that $10,000 in new deposits is received by the bank in the above table. If there were no 70 other changes in the balance sheet, then the bank would be in a position to make new loans in the amount of A) $8,000. B) $10,000. C) $13,000. D) $15,000. Other things being equal, if the required reserve ratio is raised from 10 percent to 20 percent, A) minimum potential value of the money multiplier falls from 100 to 50. B) maximum potential value of the money multiplier rises from 10 to 20. C) minimum potential value of the money multiplier rises from 0.10 to 0.20. D) maximum potential value of the money multiplier falls from 10 to 5. A bank currently has $50 million in deposits, $6 million in cash in the vault, $4 million on deposit with the Fed, and $5 million in government securities. The required reserve ratio is 20 percent. A new deposit is made of $1 million. What is the maximum size loan the bank can make once the check clears? A) $1 million B) 0 C) $5.8million D) $800,000 If a bank has $4 million in transaction deposits, and the required reserve ratio is 10 percent, then the bank's required reserves are A) $600,000. B) $3, 600,000 C) $400,000. D) $400,000. Based on the above table, the required reserve ratio for the banking system is A) 15 percent. B) 1 percent. C) 10 percent. D) 20 percent
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started