Answered: If a bank has total reserves of…

If a bank has total reserves of $200,000 and $1 million in deposits, how much money can it lend if the required reserve ratio is (a) 4 percent? (b) 6 percent?

Macroeconomics

13th Edition

ISBN:9781337617390

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter12: Money, Banking And The Financial System

Section: Chapter Questions

Problem 8WNG

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If a bank has total reserves of $200,000 and $1 million in deposits, how much money can it lend if the required reserve ratio is

(a) 4 percent?

(b) 6 percent?

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

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