Question

Suppose you deposit ​$800800 cash into your checking account. By how much will checking deposits in the banking system increase as a result when the required reserve ratio is 0.44​0? The change in checking deposits is equal​ to: ​$nothing ​(enter your result rounded to the nearest dollar​).

Answer 1

Answer:

Change in checking deposit is $18,20,000

Explanation:

Checking account is the kind or form of deposit account that is held at a institution and it allows the deposits as well as withdrawals.

The change in the checking deposit is computed as:

Change in Checking deposit = Deposit amount / Required reserve ratio

where

Demand deposit is $800,800

Required reserve ratio is 0.440

Putting the values above:

Change in checking deposit = $800,800 / 0.440

Change in checking deposit = $18,20,000