Suppose That from a New Checkable Deposit,First National Bank Holds

question 185

Multiple Choice

Suppose that from a new checkable deposit,First National Bank holds eight million dollars on deposit with the Federal Reserve,one million dollars in required reserves,and faces a required reserve ratio of ten percent. Given this information,we can say First National Bank has ________ million dollars in vault cash.

• A)two
• B)eight
• C)nine
• D)ten

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Definitions:

Observed Z Value

A statistic measured in a dataset to determine how many standard deviations an element is from the mean.

Sample Mean

The average value of a sample set of numbers, calculated by summing all observations and dividing by the number of observations.

Population Average

The mean of a particular characteristic (e.g., age, income) of all the individuals or elements in a defined population.

Standard Error

A statistical measure that quantifies the variability or dispersion of a sampling distribution, often used to estimate the accuracy of a sample mean compared to the population mean.