Use the following to answer questions:
Table: Balance Sheet
-(Table: Balance Sheet) Look at the table Balance Sheet. If the reserve ratio is 25%, loans are:

Question

Use the following to answer questions:
Table: Balance Sheet 
-(Table: Balance Sheet) Look at the table Balance Sheet. If the reserve ratio is 25%, loans are:

Quizplus · Accepted Answer

If the reserve ratio is 25%, it means that 25% of deposits must be held as reserves. Therefore, 75% of deposits can be loaned out. If loans are $60,000, it implies that the total deposits are $80,000 (since $60,000 is 75% of $80,000).

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