The largest loan that the bank can make

Assignment Help Business Economics

Reference no: EM135699

Q. Suppose that a bank's customer deposits $4,000 in her checking account. The required reserve ratio is 0.25. What are the required reserves on this new deposit? What is the largest loan that the bank can make on the basis of the new deposit? If the bank chooses to hold reserves of $3,000 on the new deposit, what are the excess reserves on the deposit?

Reference no: EM135699

Questions Cloud

Produce the pigment determining fur color : What color do you guess that the fur of these mice will be? Why with reason?

Banks assets and liabilities : Show how each of the following would initially affect a bank's assets and liabilities.

Why will someone suffering from hyponatremia : How may someone become hyponatremic in a country where the salt content of food is generally very high. What about the function.

Affect simple money multiplier : Federal Reserve lowers the required reserve ratio from 0.10 to 0.05. How does this affect the simple money multiplier.

The largest loan that the bank can make : The largest loan that the bank can make on the basis of the new deposit. If the bank chooses to hold reserves of $3,000 on the new deposit, what are the excess reserves on the deposit.

Where does the label show in mevalonate : Where does the label show in mevalonate. A spherical ball of solid, nonporous naphthalene (as in a "moth ball") is suspended in still air; naphthalene ball slowly sublimes, releasing the naphthalene into the surrounding air by molecular diffusion lim..

Government spending to achieve this goal : The government wants to increase real GDP demanded to $15 trillion at the given price level

How various antibody molecules potentially can be generated : What will the instructor tell the students are the most ordinary cause of an MI.H ow various different antibody molecules potentially could be generated.

Simple spending multiplier : For each values for the MPC, determine the size of the simple spending multiplier and the total change in real GDP demanded following a $10 billion decrease.

User Account

All Pages