Suppose the Required Reserve Ratio Is 10

question 125

Multiple Choice

Suppose the required reserve ratio is 10%. If a bank has total reserves of $80,000 and checkable deposits of $550,000, what is the amount of the bank's excess reserves?

• A) $25,000
• B) $55,000
• C) $80,000
• D) $250,000

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Definitions:

Sleepless Nights

Periods of little to no sleep, often resulting from stress, anxiety, or health issues, potentially leading to a variety of cognitive and physical effects.

Obsessions

Persistent, unwanted thoughts or urges that cause distress or anxiety.

Offensive

Relating to something that causes someone to feel hurt, angry, or upset; also can refer to an attacking action in a military or sports context.

Persistently Preoccupy

To occupy the mind continuously or for a prolonged period with a particular thought or problem, making it difficult to focus on other things.