If a single banks faces a required reserve ratio of 20 percent, has total reserves of $500,000, and checkable deposit liabilities of $400,000, what is the maximum amount of money this bank could create (add to the money supply)

Question

01-04-2022
Business

Answered

Join IDNLearn.com and start exploring the answers to your most pressing questions. Ask your questions and receive prompt, detailed answers from our experienced and knowledgeable community members.

If a single banks faces a required reserve ratio of 20 percent, has total reserves of $500,000, and checkable deposit liabilities of $400,000, what is the maximum amount of money this bank could create (add to the money supply)

Sagot :

Thank you for using this platform to share and learn. Keep asking and answering. We appreciate every contribution you make. For precise answers, trust IDNLearn.com. Thank you for visiting, and we look forward to helping you again soon.

What Is One Disadvantage Of Using An Insulin Pump To Manage Diabetes? A. Risk Of Malfunction B. Predictable Insulin Delivery C. Precise Insulin Delivery D. More

HELP NOW FOR 100 POINTS PLEASE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Select The EIGHT Countries Located On The Balkan Peninsula. Austria Albania Kosovo

What Is The Cartoonist's Message About The Closing Of Boston Harbor?

Question 4 Of 25 Does This Graph Show A Function? Explain How You Know. y 5 -5 5 -5 A. Yes, There Are No Y-values That Have More Than One X-value. B. No; The Gr

NAME THE LARGEST ANGLE NAME THE SMALLEST ANGLE

Y=-2x²-6 y= -(x-3)²+8

What Is The Frequency Of A 7.43 X 10-6 M Wave?

1.3b+7.8−3.2b Write Your Anwser Here

What Is The Distance Between The Points (4, 5) And (4, -3)

4 Friends Went Golfing This Morning. On A Particular Hole, Aisha Is 3 Under Par, Bob Is 4 Above Par, Claire Is At Par, And Dorian Is 1 Under Par. What Are The S

Ewomazinoadeidn Ewomazinoadeidn · Answer 1 · 2022-04-04T04:37:47-04:00

Tthe maximum amount of money this bank could create given the checkable deposits is $2,000,000.

What is the maximum amount of money the banik can create?

The maximum amount of money the bank create is a function of the reserve ratio and the checkable deposits. Reserve ratio is the percentage of deposits that must be kept as reserves.

Maximum deposit = deposits / reserve ratio

$400,000/ 0.2 = $2,000,000

To learn more about required reserves, please check: https://brainly.com/question/26960248

Sagot :

What is the maximum amount of money the banik can create?

Other Questions