Economics - With MindTap (2 Terms)
Economics - With MindTap (2 Terms)
13th Edition
ISBN: 9781337742030
Author: Arnold
Publisher: Cengage
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Chapter 12, Problem 8WNG
To determine

The required reserve.

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John deposits $1,600 into his checking account. If the reserve ratio is 5%, what are the required and excess reserves? Required reserves: $ Excess reserves: $
Draw a simple T-account for First National Bank of Me, which has $9000 of deposits, a reserve ratio of 10 percent, and excess reserves of $300.
Distinguish between legally required reserves and excess reserves.
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