Assume company x deposits $100,000 in cash in a commercial bank. If no excess reserves exist at the time this deposit is made and the reserve ratio is 20 percent, the bank can increase loans by a maximum of $500,000.
Reserve ratio = 20% = 20/100 = 0.25
Initial Money supply = (1/Reserve ratio)*New Deposit = (100,000/0.25) = $ 400,000
Reserve ratio = Rerserve / Deposit
=> Reserves = 0.25*100,000 = 25,000
Max Increase in Money Supply = Initial Money Supply + Reserves/ Reserve Ratio
= $ 400,000 + 100,000
= $ 500,000.
The term commercial bank refers to financial institutions that accept deposits, provide checking account services, issue various loans, and provide basic financial products such as certificates of deposit (CDs) and savings accounts to individuals and small businesses. refers to
Learn more about the commercial banks at
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Answer:
The answer is B: The population is all of the children taking skiing or snowboarding lessons
Explanation:
The population of a group is usually a group having something in common. For a research study, the population is always a large collection of people with a feature. From the population, the sample is selected. For example, all patients with mental disorder in a hospital can be the population, while patient with schizophrenia would be the sample. Thus in the example above, the population is all of the children taking skiing or snowboarding lessons.
Answer:
A cardholder fails to make a minimum payment one month.
Explanation:
A credit card late-payment fee is the fee charged by a credit card issuer because the card holder fails to pay his debt at the minimum payment deadline. This fee can be very high up to $40 depending on the card issuer. Some card issuers charge very low payment fee or no payment fee at all, therefore if you know you are someone who forgets to pay debts at the due date use credit cards that charge low payment fees.
