The Bank of Biscayne has $12 million in deposits and $800,000 in reserves. If the required reserve ratio is 5%, excess reserves are equal to

Name: The Bank of Biscayne has $12 million in deposits and $800,000 in reserves. If the required reserve ratio is 5%, excess reserves are equal to
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The required reserves for the bank are 5% of $12 million, which equals $600,000. Since the bank has $800,000 in reserves, the excess reserves are $800,000 - $600,000 = $200,000.

The Bank of Biscayne Has $12 Million in Deposits and $800,000