If the Required Reserve Ratio Is 20 Percent and a Bank

question 42

Multiple Choice

If the required reserve ratio is 20 percent and a bank has $100,000 in checkable deposits,then its

• A)required reserves are $500,000
• B)required reserves are $20,000
• C)assets are $500,000
• D)liabilities are $500,000
• E)liabilities plus its net worth are $500,000