If Actual Cash Reserves in the Banking System Are $8,000

question 188

Multiple Choice

If actual cash reserves in the banking system are $8,000, demand deposits are $70,000, and the desired reserve ratio is 10 percent, then excess reserves:

• A)are zero.
• B)are $1,000.
• C)are $2,000.
• D)cannot be determined from this information.

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