A bank has currency and coins equal to $20 million in its vaults.It has securities worth $10 million, has borrowings equal to $5 million, and has given out loans equal to $2 million.It also has deposits with the Federal Reserve equal to $4 million.The total reserves of the bank equals
A)$12 million.
B)$22 million.
C)$24 million.
D)$36 million.

Question

Quizplus · Accepted Answer

The bank's total reserves consist of its currency and coins held in vaults plus its deposits with the Federal Reserve. Thus, the bank's total reserves can be calculated as: 
Total reserves = Currency and coins held in vaults + Deposits with the Federal Reserve
Total reserves = $20 million + $4 million
Total reserves = $24 million
Therefore, the correct answer is C ($24 million).

A Bank Has Currency and Coins Equal to $20 Million