A Bank with $1 Million in Deposits and $50,000 in Excess

question 170

True/False

A bank with $1 million in deposits and $50,000 in excess reserves,facing a required reserve ratio of 20 percent,holds total reserves of $250,000.

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Definitions:

Industrialization

The development of industries in a country or region on a wide scale, characterized by the shift from agrarian to industrial modes of production.

Business Representative

An individual who acts on behalf of a business entity in dealings with others, such as negotiations or partnerships.

Secretary-Treasurer

A combined executive role in organizations, responsible for both the secretarial duties and the financial management of the entity.

Negotiate Contracts

The process of discussing the terms of a contract between two or more parties to reach a mutual agreement.