If a Bank Has Excess Reserves of $7,000 and Demand

question 89

Multiple Choice

If a bank has excess reserves of $7,000 and demand deposit liabilities of $100,000,and if the reserve requirement is 15 percent,then the bank has actual reserves of

• A)$17,000.
• B)$22,000.
• C)$27,000.
• D)$29,000.

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Definitions:

Commonsense Theory

Using anecdotal information to guide understanding.

Past Experiences

Refers to previous events or activities that an individual or organization has undergone, influencing future behavior or decisions.

Persuasion

The act or process of influencing someone's beliefs, attitudes, or behaviors through argument, reasoning, or appeal to emotion.

Human Communication

The process by which individuals exchange information, feelings, and meanings through verbal and non-verbal messages.