Scenario 25-2

Imagine that Kristy deposits $10,000 of currency into her checking account deposit at Bank A and that the required reserve ratio is 20%.

-Refer to Scenario 25-2. As a result of Kristy's deposit, Bank A's excess reserves increase by

Question

Scenario 25-2

Imagine that Kristy deposits $10,000 of currency into her checking account deposit at Bank A and that the required reserve ratio is 20%.

-Refer to Scenario 25-2. As a result of Kristy's deposit, Bank A's excess reserves increase by

Quizplus · Accepted Answer

The required reserve ratio is 20%, so Bank A must keep $2,000 (20% of $10,000) as required reserves. The remaining $8,000 is excess reserves.

Scenario 25-2 Imagine That Kristy Deposits $10,000 of Currency into Her Checking