Details of this Paper

A new bank has vault cash of $1 million and $5 mil...

Description

Solution


Question

A new bank has vault cash of $1 million and $5 million in deposits held at its Federal Reserve District Bank. a. If the required reserves ratio is 8 percent, what dollar amount of deposits can the bank have? b. If the bank holds $65 million in deposits and currently holds bank reserves such that excess reserves are zero, what required reserves ratio is implied?

 

Paper#2713 | Written in 18-Jul-2015

Price : $25
SiteLock