A Bank's Checkable Deposits Shrinks from $40 Million to $33

question 82

Multiple Choice

A bank's checkable deposits shrinks from $40 million to $33 million. What happens to its required reserves if the required reserve ratio is 3%?

• A) They fall by about $1.2 million
• B) They fall by about $10 million
• C) They fall by about $7 million
• D) They fall by about $0.2 million

---

Definitions:

Negative

Characterized by the absence of positivity, often involving criticism or undesirable outcomes.

Arrogant

Having or revealing an exaggerated sense of one's own importance or abilities.

Hidden Negative

Subtle undesirable qualities or aspects that are not immediately obvious.

Developed

Refers to something that has been brought to a more advanced, elaborate, or refined state.