A bank has $770 million in checkable deposits. The bank has $85 million in reserves. The bank's required reserves are ________ a
nd its excess reserves are ________. Group of answer choices $85 million; $0 $770 million; $85 million $685 million; $8.5 million $77 million; $8 million
The correct answer is letter "D": $77 million; $8 million.
Explanation:
The U.S. Federal Reserve (Fed) establishes a minimum amount of money banks must have in front of unexpected demand. That minimum is called Bank Reserve. <em>The current bank reserve set by the Fed is 10% of the bank's demand and checking deposits.
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Excess reserves <em>is the amount of money banks have on top of the bank reserve</em> that cannot loan. As banks do not profit in interest with that amount of money, they do not tend to have much excess reserves.
any program or number of programs designed for end-users. That’s it, in a nutshell. In that sense, any end user program can be called an “application.”
