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Kipish [7]
2 years ago
15

Assuming that the federal reserve banks sell $40 million in government securities to commercial banks and the reserve ratio is 2

0 percent, then the effect will be to reduce: group of answer choices
Business
1 answer:
sdas [7]2 years ago
8 0

The reserve requirement when the federal reserve banks sell $40 million in government securities to commercial banks is $8 million.

<h3>How to calculate the reserve requirement?</h3>

From the information given, the the federal reserve banks sell $40 million in government securities to commercial banks and the reserve ratio is 20 percent.

Therefore, the reserve requirement will be:

= 20% × $40 million

= $8 million.

Learn more about reserve requirements on:

brainly.com/question/25812353

#SPJ1

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