Suppose Total Deposits in the First Bank of Commerce Are

question 50

Multiple Choice

Suppose total deposits in the First Bank of Commerce are $200,000 and required reserves are $10,000. Based on this information, the required reserve ratio is:

• A)0.05.
• B)0.10.
• C)0.20.
• D)20.0.

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Definitions:

Held-to-maturity Securities

Financial instruments that a company has the intent and ability to hold until they mature.

Interest Revenue

Income earned from lending funds or investing in interest-bearing financial instruments.

Fair Value Adjustment

An accounting practice of updating the book value of assets and liabilities to reflect their current market values.

Adjunct Asset

An addition to an asset that increases its value, often for accounting or tax purposes.