If the Desired Reserve Ratio Is Ten Percent, Currency in Circulation

question 150

Multiple Choice

If the desired reserve ratio is ten percent, currency in circulation is $400 billion, chequable deposits are $1000 billion, and excess reserves total $1 billion, then the currency ratio is ________.

• A) .25
• B) .50
• C) .40
• D) .05

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Definitions:

Protons

Positively charged subatomic particles found within the nucleus of an atom and determining the atom's element.

Eukaryotes

Organisms whose cells contain a nucleus enclosed within a membrane, including animals, plants, fungi, and protists, distinguishing them from prokaryotes.

Peptidoglycan

A polymer consisting of sugars and amino acids that forms a mesh-like layer outside the plasma membrane of most bacteria, providing structural support and shape.

Mitochondria

Membrane-bound cell organelles that produce most of the chemical energy needed to power the cell's biochemical reactions.