The ABC Commercial Bank has $5,000 in excess reserves, and the reserve ratio is 25 percent. This information is consistent with the bank having A) $90,000 in checkable deposit liabilities and $32,000 in reserves. B) $90,000 in checkable deposit liabilities and $22,500 in reserves. C) $20,000 in checkable deposit liabilities and $10,000 in reserves. D) $90,000 in outstanding loans and $22,500 in reserves.
The ABC Commercial Bank has $5,000 in excess reserves, and the reserve ratio is 25 percent. This information is consistent with the bank having A) $90,000 in checkable deposit liabilities and $32,000 in reserves. B) $90,000 in checkable deposit liabilities and $22,500 in reserves. C) $20,000 in checkable deposit liabilities and $10,000 in reserves. D) $90,000 in outstanding loans and $22,500 in reserves.
Chapter25: Money Creation
Section: Chapter Questions
Problem 18SQ
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The ABC Commercial Bank has $5,000 in excess reserves , and the reserve ratio is 25 percent. This information is consistent with the bank having
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