Narnia National Bank has $750 million in deposits. The required reserve ratio is 30%. Narnia National Bank must keep ________ in reserves.

Question

Quizplus · Accepted Answer

The required reserve ratio is 30%, meaning that the bank must keep 30% of its deposits in reserves. To find out how much Narnia National Bank must keep in reserves, we multiply the deposits by the required reserve ratio:

$750 million x 0.30 = $225 million

Therefore, the correct answer is C) $225 million.

Narnia National Bank Has $750 Million in Deposits