A Bank with $200 Million in Transaction Deposits Keeps $20

question 493

Multiple Choice

A bank with $200 million in transaction deposits keeps $20 million in cash in the bank vault, $10 million in deposits at the Fed, and $5 million in government securities in the bank vault. Its total reserves equal

• A)$10 million.
• B)$20 million.
• C)$30 million.
• D)$35 million.

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Definitions:

Motives

Internal states that prompt goal-directed behavior, driving individuals to fulfill their needs and desires.

Truth

Conformity to fact or actuality; a statement proven to be or accepted as true.

Honesty

The quality of being truthful, trustworthy, and free from deceit or fraud.

Beauty

A characteristic of a person, object, place, or idea that provides a perceptual experience of pleasure, meaning, or satisfaction, often judged based on culture, art, and aesthetics.