If a Bank That Desires to Hold No Excess Reserves

question 65

Multiple Choice

If a bank that desires to hold no excess reserves and has just enough reserves to meet the required reserve ratio of 15 percent receives a deposit of $600,it has a

• A)$600 increase in excess reserves and no increase in required reserves.
• B)$600 increase in required reserves and no increase in excess reserves.
• C)$510 increase in excess reserves and a $90 increase in required reserves.
• D)$90 increase in excess reserves and a $510 increase in required reserves.

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Definitions:

Cognition

The mental processes involved in gaining knowledge and comprehension, including aspects like thinking, knowing, remembering, judging, and problem-solving.

Mental Processes

These refer to the internal cognitive activities that include thinking, perceiving, problem-solving, and information processing.

Cognitive Activity

Cognitive activity involves processes related to thinking, such as problem-solving, memory, decision-making, and perception, indicative of the mental action or process of acquiring knowledge and understanding.

Syntax

In linguistics, the set of rules that dictate the structure of sentences in a language.