Suppose That a Bank Has $8,000 in Checkable Deposits and the Required

question 209

Multiple Choice

Suppose that a bank has $8,000 in checkable deposits and the required reserve ratio is 0.2.If actual reserves equal $3,000,then excess reserves equal

• A)$1,600
• B)$1,400
• C)$2,400
• D)$5,000
• E)zero

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Definitions:

Interest Rates

The percentage at which interest is paid by a borrower for the use of money they borrow from a lender, or the rate earned on an investment, typically expressed as an annual percentage rate.

Construction Company

A business entity focused on the building of residential, commercial, or industrial structures, infrastructure projects, and associated activities.

Conditional Probabilities

The chances of an event's occurrence, predicated on the fact that another event has happened.

Bayes' Law

A theorem using probability to update predictions or beliefs in light of new evidence.