The Manager of the Bank Where You Work Tells You

question 31

Multiple Choice

The manager of the bank where you work tells you that your bank has $6 million in excess reserves.She also tells you that the bank has $400 million in deposits and $362 million dollars in loans.Given this information you find that the reserve requirement must be

• A)44/400.
• B)6/362.
• C)38/400.
• D)32/400.

---

Definitions:

Random Walk

A theory suggesting that stock market prices evolve according to a random path and are therefore unpredictable.

Stock Prices

The cost of purchasing a share of a company, reflecting the market's valuation of that company.

Standard Deviation

A measurement that quantifies the variation or dispersion of a set of numerical data points.

Annual Rate

The annual rate refers to the interest or return on an investment over a one-year period, expressed as a percentage of the investment's initial value.