When you open a checking account at Bank of America,Bank of America
A)has more reserves and more excess reserves.
B)has more reserves,but excess reserves remain unchanged.
C)has more deposits and less in excess reserves.
D)has more deposits,but excess reserves remain unchanged.

Question

Quizplus · Accepted Answer

When a checking account is opened at Bank of America, the bank's reserves increase by the amount of the deposit. This is because the bank is now required to hold a certain percentage of its deposits in reserve. The bank's excess reserves also increase by the amount of the deposit, since the bank now has more reserves than it is required to hold.

When You Open a Checking Account at Bank of America,Bank