If a Bank Has $32 Million in Deposits and the Required

question 244

True/False

If a bank has $32 million in deposits and the required reserve ratio is 4 percent, the bank's required reserves equal $0.8 million.

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Definitions:

Equity Multiplier

A financial ratio indicating how much of a company's assets are financed by its shareholders' equity.

Debt-to-equity Ratio

This metric measures the relative contribution of shareholder equity and debt in the funding of a company's assets.

Dividend Yield Ratio

This ratio indicates the annual dividend payments of a company as a percentage of its current share price.

Earnings per Share

A financial ratio indicating the portion of a company's profit allocated to each outstanding share of common stock, showing the company's profitability per share.