A Bank Has $50,000 in Deposits from Its Checking Account

question 189

Multiple Choice

A bank has $50,000 in deposits from its checking account customers and loans of $49,000. Of the $49,000 loaned out, $43,000 remains in the checking accounts of the loan recipients. The bank has $50,000 cash on hand, and the reserve requirement is 25%. The reserve ratio for this bank is _____, and it _____ meeting its reserve requirement.

• A) 0.002%; is not
• B) 20%; is
• C) 53.76%; is
• D) 186%; is not

Appreciate the importance of budget reports for managerial feedback and control.

Understand the significance of comparing actual to planned results and the utility of budget reports.

Grasp the concept of flexible budgeting and its adaptability to various levels of activity.

Understand the concept and calculation of the fiscal multiplier and the marginal propensity to consume (MPC).

---

Definitions:

Ethical Compliance Programs

Initiatives within organizations designed to ensure behavior and practices adhere to both legal standards and ethical norms.

Institutionalization

The process of integrating or embedding practices, norms, or values into an organization or society so they become stable and expected behaviors.

Organizational Culture

The shared values, beliefs, and norms that define how a company's employees interact, make decisions, and handle external relations.

Employee Compensation

All forms of pay or rewards going to employees and arising from their employment, including salary, wages, bonuses, and benefits.