If the Desired Reserve Ratio Is 15 Percent, the Simple

question 107

Multiple Choice

If the desired reserve ratio is 15 percent, the simple deposit multiplier is ________.

• A) 15.0
• B) 1.5
• C) 6.67
• D) 3.33

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Definitions:

Statement Of Cash Flows

A financial document showing how changes in balance sheet accounts and income affect cash and cash equivalents, breaking the analysis down to operating, investing, and financing activities.

Inventory

The complete list of items such as goods, materials, and products that a business holds for the ultimate goal of resale or repair.

Operating Activities

Activities that relate to the primary operations of a company, such as sales and production, and their effects on cash flow.

Fixed Asset Turnover Rate

A ratio that measures how efficiently a company uses its fixed assets to generate sales.