Suppose a bank is exactly meeting its desired reserve ratio of 10 percent and a new deposit of $75,000 is made. Immediately after the deposit is made, the bank's excess reserves equal

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The new deposit increases the bank's reserves by $75,000. With a reserve ratio of 10%, the bank needs to keep $7,500 (10% of $75,000) as required reserves. The remaining $67,500 ($75,000 - $7,500) is excess reserves that the bank can lend out.

Suppose a Bank Is Exactly Meeting Its Desired Reserve Ratio