Suppose the banks in the Federal Reserve System have $100 billion in transactions accounts,the required reserve ratio is 0.10,and there are no excess reserves in the system.If the required reserve ratio is changed to 0.15,the deficiency of reserves would be

Question

Quizplus · Accepted Answer

Initially, with a 0.10 reserve ratio, required reserves are $10 billion. With a 0.15 ratio, required reserves become $15 billion, creating a $5 billion deficiency.

Suppose the Banks in the Federal Reserve System Have $100