Exhibit 15-2 Balance Sheet of Springfield National Bank

In Exhibit 15-2, if Springfield National's customers write checks for $200 and the required reserve ratio is 20 percent, then its required reserves fall to:

Question

Exhibit 15-2 Balance Sheet of Springfield National Bank

In Exhibit 15-2, if Springfield National's customers write checks for $200 and the required reserve ratio is 20 percent, then its required reserves fall to:

Quizplus · Accepted Answer

The required reserve ratio is 20 percent, so for every $100 of deposits, the bank is required to hold $20 in reserve. If customers write checks for $200, the bank's deposits decrease by $200, and the required reserves decrease by 20 percent of $200, or $40. Therefore, the new required reserves would be $160.