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Katarina [22]
3 years ago
11

A bank has a reserve requirement of 0.08. If it has demand deposits of $200,000 and is holding $4,000 in reserves: a. the bank i

s holding $2,000 in excess reserves. b. the bank could extend additional loans and still meet its reserve requirement. c. all the bank's reserves are excess reserves. d. the bank is not meeting its reserve requirement.
Business
1 answer:
hoa [83]3 years ago
5 0

Answer:

Option (d) is correct.

Explanation:

Given that,

Reserve requirement = 0.08

Demand deposits = $200,000

Holding in reserves = $4,000

Reserve required:

= Reserve Requirement ratio × Amount of demand deposits

= 0.08 × $200,000

= $16,000

Therefore, the reserves in holding is less than the required reserves. Hence, the bank is not meeting its reserve requirement.  

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A broker operates an office in a town on the state line. A buyer from the adjoining state wants to see homes on both sides of th
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Answer:

In this case, the broker:

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Say you are considering two loans. Loan F has a nominal interest rate of 5. 66%, compounded monthly. Loan G has a rate of 6. 02%
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When the effects and impacts of compounding over time are taken into account, the effective annual interest rate is the true return on a savings account or any other interest-paying investment.

Option C is the correct answer:  Loan F's effective rate will be 0.302 percentage points lower than Loan G's.

<h3>Given</h3>

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<h3>Computations of effective rates</h3>

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For more information about the related question, refer below

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