If a Bank Has Excess Reserves of $5,000 and Demand

question 33

Multiple Choice

If a bank has excess reserves of $5,000 and demand deposit liabilities of $80,000,and if the reserve requirement is 20 percent,then the bank has actual reserves of

• A)$11,000.
• B)$20,000.
• C)$21,000.
• D)$26,000.

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Definitions:

Hallucinogens

Drugs that cause profound distortions in a person's perceptions of reality, including visual and auditory hallucinations, often without delirium.

Mania

A mental state characterized by an excessively elevated mood, energy levels, and activity, often associated with bipolar disorder.

Grandiosity

An exaggerated sense of one's importance, power, knowledge, or identity, often found in personality disorders or manic episodes.

Flight of Ideas

A symptom often seen in manic episodes where an individual's thoughts rapidly and frequently change topics in a disconnected, fragmented manner.