A Bank Has $770 Million in Checkable Deposits

question 11

Multiple Choice

A bank has $770 million in checkable deposits. The bank has $85 million in reserves. The bank's required reserves are _____________ and its excess reserves are _____________.

• A) $85 million; $0
• B) $770 million; $85 million
• C) $89 million; $21 million
• D) $685 million; $8.5 million
• E) $77 million; $8 million Required = 10% (770); Excess = 85 - 10% (770)

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Definitions:

Standard Costs

Predetermined costs for materials, labor, and overhead used as benchmarks for measuring performance.

Kilos

A unit of measurement equivalent to one thousand grams, used commonly across the world to denote mass in the metric system.

Raw Material

Basic substances in their natural, modified, or semi-processed states used as an input for a manufacturing process.

Standard Costs

Predetermined costs for materials, labor, and overhead that are used as benchmarks for measuring actual performance and cost control.