Bank of New City has $250 million in deposits. Bank of New City is meeting its Reserve requirement and has no excess reserves. It has $50 million in reserves. Bank of New city faces a required reserve ratio

Bank of New City has $250 million in deposits. Bank of New City is meeting its Reserve requirement and has no excess reserves. It has $50 million in reserves. Bank of New city faces a required reserve ratio

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter27: Money And Banking

Section: Chapter Questions

Problem 30P: A bank has deposits of 400. It holds reserves of 50. It has purchased government bonds worth 70. It...

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Question

19.

Bank of New City has $250 million in deposits. Bank of New City is meeting its

Reserve requirement and has no excess reserves. It has $50 million in reserves. Bank of New city faces a required reserve ratio of:

25%.
4%.
20%.
5%.

Definition Definition Minimum amount that a commercial bank must hold in liquid assets in order to fulfill central bank regulations.

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20. Bank of New City has $750 million in deposits. The required reserve ratio is 15%. Bank of New City must keep_______ in reserves. $150.5 million $60.5 million $112.5 million $160.5 million
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21. Republic Bank has $2 million in deposits and $250,000 in reserves. If the required reserve ratio is 10%, excess reserves are equal to: $200,000. $50,000. zero $450,000.
6. If a bank has reserves of $75 and excess reserves are equal to $0 when the reserve ratio is 10%, the bank has deposits of $
18. Suppose TD Bank has a target reserve ratio of 2%. If it receives a new deposit of $40 million it will immediately find itself with excess cash reserves of $20 million. excess cash reserves of $39 million. excess cash reserves of $8 million. excess cash reserves of $39.2 million. no excess cash reserves.
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Question 35 If a bank has a required reserve ratio of 25% and there are $5,300,000 in deposits, what is amount of required reserves? $25,000 $280,000 $1,325,000 $2,275,000 $5,005,000
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