Suppose a Bank Has $100,000 in Checking Account Deposits with No

question 55

Multiple Choice

Suppose a bank has $100,000 in checking account deposits with no excess reserves and the required reserve ratio is 10 percent.If the Federal Reserve raises the required reserve ratio to 12 percent,then the bank will now have excess reserves of

• A)$12,000.
• B)$0.
• C)-$2,000.
• D)-$12,000.

---

Definitions:

American General

A high-ranking officer in the United States Army, Marine Corps, or Air Force, often commanding large military units or holding senior administrative positions.

Mexico City

The capital and largest city of Mexico, known for its rich history, culture, and significant influence in Latin America.

Abraham Lincoln

The 16th President of the United States, who led the country during the Civil War and issued the Emancipation Proclamation.

War With Mexico

Refers to the Mexican-American War (1846-1848), a conflict between the United States and Mexico, leading to the U.S. acquisition of territories in what is now the southwest United States.