A bank has $325 million in deposits, it is obliged to maintain a 20% mandatory (required) reserve.
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Question:
A bank has $325 million in deposits, it is obliged to maintain a 20% mandatory (required) reserve.
Noted:
- How much would the mandatory reserve be (in dollars)?
- How much would the excess reserve be (in dollars)?
- Determine the Deposit Multiplier.
- If reserves increase by $2 million, indicate how much will deposits increase?
Related Book For
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
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