Suppose the Canadian Banking System Jointly Has $20 Million in Reserves

question 25

Multiple Choice

Suppose the Canadian banking system jointly has $20 million in reserves (cash and deposits at the Bank of Canada) , all banks have a target reserve ratio of 20 percent, and there are no excess reserves. What is the amount of deposits in the banking system?

• A)$100 million
• B)$4 million
• C)$80 million
• D)$40 million
• E)$120 million

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Definitions:

Aboriginals

Indigenous peoples native to a land or region, especially referring to the First Nations, Inuit, and Métis peoples of Canada.

American West

A region of the United States located west of the Mississippi River, characterized by its diverse landscapes, history of expansion and settlement, and cultural significance.

Agricultural Production

Refers to the process of cultivating crops and livestock for human consumption and use.