A Bank Has an Average Balance of Transactions Accounts,August 10

question 61

Multiple Choice

A bank has an average balance of transactions accounts,August 10 to 23,of $824.46 million.The average balance in the cash account is $42.014 million over this period.The bank is carrying forward a deficit of $1.276 million from the last reserve period.The rules require no reserves to be maintained for the first $8.5 million,3 percent for amounts between $8.5 million and $45.8 million,and 10 percent thereafter.

What is the gross reserve requirement?

• A)$74.653 million.
• B)$78.985 million.
• C)$76.747 million.
• D)$72.461 million.

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Definitions:

Total Surplus

The sum of consumer surplus and producer surplus in a market, representing the total benefits that buyers and sellers receive from participating in the market.

Tax

A compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund various public expenditures.

Good

A tangible product or item that satisfies some human want or need.

Equilibrium Quantity

The quantity of goods or services supplied is exactly equal to the quantity demanded at the market price.