Suppose the banking system currently has $300 billion in reserves, the reserve requirement is 5%, and excess reserves are $30 billion. Assume there is no bank capital. How much money is being loaned out? A. $270 billion B. $300 billion C. $330 billion D. $5,100 billion E. $5,400 billion F. $6,000 billion
Suppose the banking system currently has $300 billion in reserves, the reserve requirement is 5%, and
In a 100% reserve banking system, what is the money multiplier?
| A. |
The money multiplier is 1, meaning banks do not impact the money supply |
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| B. |
The money multiplier is 1, meaning banks change the money supply |
|
| C. |
The money multiplier is 0, meaning banks do not impact the money supply |
|
| D. |
The money multiplier is 0, meaning banks change the money supply |
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A bank has $2 million in reserves and $14 million in loans. These are the bank's only assets and bank capital is $0. What is the reserve ratio?
A. 2%
B. 12.5%
C. 14%
D. 14.3%
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