Use the balance sheet below for the following questions.
Table 29-2

-Refer to Table 29-2. If $1000 is deposited into the First Bank of Mason City, which of the following happens?
A)Total reserves will initially increase by $200.
B)Liabilities will decrease by $1000.
C)Assets will increase by $1000.
D)Required reserves will increase by $800.

Question

Use the balance sheet below for the following questions.
Table 29-2
 
-Refer to Table 29-2. If $1000 is deposited into the First Bank of Mason City, which of the following happens?
A)Total reserves will initially increase by $200. 
B)Liabilities will decrease by $1000. 
C)Assets will increase by $1000. 
D)Required reserves will increase by $800.

Quizplus · Accepted Answer

Depositing $1000 into the bank will increase the bank's assets by $1000, as deposits are considered assets for banks.

Use the Balance Sheet Below for the Following Questions