If banks desire to hold no excess reserves,the reserve ratio is 10 percent,and a bank that was previously just meeting its reserve requirement receives a new deposit of $400,then initially the bank has a
A) $400 increase in excess reserves and no increase in required reserves.
B) $400 increase in required reserves and no increase in excess reserves.
C) $360 increase in excess reserves and $40 increase in required reserves.
D) $40 increase in excess reserves and $360 increase in required reserves.
Correct Answer:
Verified
Q3: In a system of 100-percent-reserve banking,
A)banks do
Q191: Table 29-3.
The First Bank of Johnson City
Q192: Table 29-2.An economy starts with $10,000 in
Q193: In a fractional-reserve banking system,a bank
A) does
Q194: Suppose that banks desire to hold no
Q195: Table 29-2.An economy starts with $10,000 in
Q197: Suppose that banks desire to hold no
Q198: Suppose banks desire to hold no excess
Q199: Table 29-3.
The First Bank of Johnson City
Q201: Table 29-5.
Bank of Kopeka
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