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Suppose that an open economy starts with $1,000 and all of this money is deposited into a First Economy Bank. The T-account for First Economy
Suppose that an open economy starts with $1,000 and all of this money is deposited into a First Economy Bank. The T-account for First Economy bank is shown below.
Assets | Liabilities |
Required Reserve 100 | Deposits: $1000 |
Loans $400 | |
Treasury Bills $800 |
Given the information above, how much capital does the bank currently hold and what is the required reserve ratio
a. $300; 1%
b. $1,300; 10%
c. $1,000; 10%
d. $500; 40%
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