The following is a consolidated balance sheet for the chartered banking system.All figures are in billions.Assume that the desired reserve ratio is 20 percent. Refer to the above information.If there is a deposit of $10 billion of new currency into chequing accounts in the banking system, excess reserves will increase by:
A)$1 billion.
B)$2 billion.
C)$8 billion.
D)$10 billion.

Question

The following is a consolidated balance sheet for the chartered banking system.All figures are in billions.Assume that the desired reserve ratio is 20 percent.  Refer to the above information.If there is a deposit of $10 billion of new currency into chequing accounts in the banking system, excess reserves will increase by:
A)$1 billion. 
B)$2 billion. 
C)$8 billion. 
D)$10 billion.

Quizplus · Accepted Answer

The Answer of The following is a consolidated balance sheet for the chartered banking system.All figures are in billions.Assume that the desired reserve ratio is 20 percent.  Refer to the above information.If there is a deposit of $10 billion of new currency into chequing accounts in the banking system, excess reserves will increase by:
A)$1 billion. 
B)$2 billion. 
C)$8 billion. 
D)$10 billion.

The Following Is a Consolidated Balance Sheet for the Chartered