Suppose Bank ABC has a target reserve ratio of 10 percent. If Bank ABC receives a new deposit of $100 000 it will immediately find itself with
A) excess cash reserves of $90 000.
B) excess cash reserves of $10 000.
C) excess cash reserves of $100 000.
D) no excess cash reserves.
E) excess cash reserves equal to 10 percent of its deposits.
Correct Answer:
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