The Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is

Question:

The Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is 20 percent. Households deposit $5000 in currency into the bank that is added to reserves. What level of excess reserves does the bank now have?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Economics

ISBN: 978-0073375694

18th edition

Authors: Campbell R. McConnell, Stanley L. Brue, Sean M. Flynn

See More Books

Question Posted: May 23, 2013 07:56 AM

See More Questions

Suppose again that the Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is 20 percent. The bank now sells $5000 in securities to the Federal Reserve...
Excess reserves make a bank less vulnerable to runs. Why, then, dont bankers like to hold excess reserves? What circumstances might persuade them that it would be advisable to hold excess reserves?
The required reserve ratio is 9 percent, required reserves are $10 million, and (total) reserves are $50 million. How much do excess reserves equal? How much do checkable deposits equal?
0.1 M CH3COOH with 0.1 M NH3. The relative conductivities of the solutions tested are as follows: 0.1 M CH3COOH/0.1 M NH3 measured in parallel: (b) 0.1 M CH,COOH with 0.1 M NH,. The relative...
Data were collected from a random sample of 220 home sales from a community in 2003. Let Price denote the selling price (in $1000), BDR denote the number of bedrooms, Bath denote the number of...
Portsmouth Company makes upholstered furniture. Its only variable cost is direct materials. The demand for the company's products far exceeds its manufacturing capacity. The bottleneck ( or...
What is it about postsale follow-up that makes it one of the most important ways to enhance long-term customer relationships? What specific things can you do in follow-up to accomplish this?
On page 243, we presented a frequency distribution for data on chest circumference, in inches, for 5732 Scottish militiamen. As mentioned there, Adolphe Quetelet used a procedure for fitting a normal...
These items are taken from the financial statements of Pronghorn Corp. at December 3 1 , 2 0 2 5 . Buildings $ 1 2 1 , 7 0 0 Accounts receivable 1 4 , 5 0 0 Prepaid insurance 5 , 3 8 0 Cash 1 3 , 6 2...
WVTU is a television station that has 20 thirty-second advertising slots during its regularly scheduled programming each evening. The station is now selling advertising for the first few days in...
Suppose that Continental Bank has the simplified balance sheet shown below and that the reserve ratio is 20 percent: a. What is the maximum amount of new loans that this bank can make? Show in column...
Suppose a bank discovers that its reserves will temporarily fall slightly short of those legally required. How might it remedy this situation through the Federal funds market? Now assume the bank...
Airship Solutions is an Australian company that provides drone photography, aerial photography, videography, and advertising, with seven locations around the world. Its blimps, which are filled with...
A)When the market has a return of 30%, your company is expected to have a return of 24%. When the market has a return of -20%, your company is expected to have a return of -16%. What is the beta of...
what are the basic tenets of using Motivational Interviewing with clients with SUDs? Discuss how counselors can roll with resistance while working a family in which the client with an SUD is in the...
Calculate the key components an equity investor requires. Using recordings in week 6 illustrate pre and post money valuation of a startup. Define how indications of interest are utilized by a start...
If someone offers you $200 in 8 years for an investment of $100 today, what is the annual rate of return?
Your stock is currently selling for $64.94. Assuming you plan to pay a dividend of $5 next year, and the dividends are expected to grow at a yearly rate of 3% indefinitely, what is the required...
The fluoride ion concentration in a saturated solution of magnesium fluoride, MgF 2 , is 2.3 x 10 -3 M. Calculate the value for the equilibrium constant.
Complete the equations for the following equilibria and calculate Keq where the Keq expression includes [HO]. Be sure to enter Keq in proper scientific notation. (a) ammonia (acting as a base) reacts...
Common expenditures in a Capital Projects Fund include a. bond issue costs. b. payments to contractors. c. bond discounts. d. All of the above are common expenditures in a Capital Projects Fund. e....
Florida citrus growers say that the recent crackdown on illegal immigration is increasing the market wage rates necessary to get their oranges picked. Some are turning to $100,000 to $300,000...
Danny Dimes Donahue is a neighbourhood's 9-year old entrepreneur, His most recent venture is selling homemade and brownies that he bakes himself. At a price of $1.50 each, he sells 100. At a price of...
Danny Dimes Donahue is a neighbourhood's 9-year old entrepreneur, His most recent venture is selling homemade and brownies that he bakes himself. At a price of $1.50 each, he sells 100. At a price of...
E3-20 (Algo) Analyzing, Recording, and Evaluating the Effects of Income Statement Transactions [LO 3-3, LO 3-4, LO 3-5] [The following information applies to the questions displayed below.] MyBnB...
Required information [The following information applies to the questions displayed below.] The following data reports on the July production activities of the Molding department at Ash Company....
Question 1 Vieux Enterprise's total overhead costs at various levels of activity follow: Month Machine- Hours Total Overhead Costs April 70,000 $198,000 May 100,000 270,000 June 80,000 222,000 July...

The Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is

Question:

Step by Step Answer:

Checkable deposits have risen to 105000 ...View the full answer

Economics

Students also viewed these Economics questions