Table 29-5. -Refer to Table 29-5. If the Bank Faces a Reserve

question 380

Multiple Choice

Table 29-5.
-Refer to Table 29-5. If the bank faces a reserve requirement of 20 percent, then it

• A)has $10,000 of excess reserves.
• B)needs $10,000 more reserves to meet its reserve requirements.
• C)needs $20,000 more reserves to meet its reserve requirements.
• D)just meets its reserve requirement.

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Definitions:

Long-lived Assets

Assets that have a useful life of more than one year, used in the operation of a business and not intended for resale.

Cash Balance

The amount of cash on hand at any given time in a company's financial accounts.

End of the Period

A term referring to the conclusion of a specific accounting period, at which financial statements are prepared.

Statement of Cash Flows

A financial report that details the amount of cash and cash equivalents entering and leaving a company.