Bank A has checkable deposits of $10 million and total reserves of $1 million.The required reserve ratio is 9 percent.The bank has excess reserves of

Question

Quizplus · Accepted Answer

The required reserves for the bank is $900,000 ($10 million x 0.09). Since the bank has total reserves of $1 million, the excess reserves would be $100,000 ($1 million - $900,000). Therefore, the correct answer is C.

Bank a Has Checkable Deposits of $10 Million and Total