If a Bank Has $200 Million in Deposits, the Required

question 23

Multiple Choice

If a bank has $200 million in deposits, the required reserve rate is 10 percent and the bank has $23 million in reserves:

• A) the bank is short of required reserves.
• B) the bank has excess reserves of $21 million.
• C) the bank has excess reserves of $13 million.
• D) the bank has excess reserves of $3 million.

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Definitions:

Sample Mean

The average value of a sample subset of a larger population, used as an estimate of the population mean.

Point Estimate

A single value estimate for a population parameter derived from a sample.

Population Mean

The average value of a population's characteristics.

Standard Deviation

A statistical metric that quantifies the variation or dispersion of a set of data points from the mean.