If Excess Reserves Are $30,000,demand Deposits Are $500,000,and the Minimum

question 31

Multiple Choice

If excess reserves are $30,000,demand deposits are $500,000,and the minimum reserve requirement is 10 percent,then total reserves are:

• A) $20,000
• B) $30,000
• C) $50,000
• D) $80,000

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Definitions:

Common Stock

A form of corporate equity ownership, a type of security representing an ownership share in a corporation, where holders benefit from company profits and voting rights.

Convertible Preferred Stock

A type of preferred stock that holders can convert into a predetermined amount of the company's common stock, usually at specific times.

Common Stock

A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's profits and assets.

Par Value

The nominal or face value of a stock or bond as stated by the issuer, which does not necessarily reflect its market value.