Suppose a bank has $6,000 in checkable deposits and the required reserve ratio is 0.2.If the bank wishes to hold no excess reserves,its actual reserves will be:

Question

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The required reserves for the bank, given a reserve ratio of 0.2 (or 20%), would be 20% of $6,000, which is $1,200. If the bank wishes to hold no excess reserves, its actual reserves will exactly match its required reserves, which are $1,200.

Suppose a Bank Has $6,000 in Checkable Deposits and the Required