A bank’s reserve ratio is 10 percent and the bank has $2,000 in deposits. Its reserves amount to

Solution:

It is given that

Reserve ratio = 10%

Deposit = $2,000

We know that

The reserves amount can be found by multiplying the reserve ratio with the deposit

Reserves amount = Reserve ratio × Deposit

Substituting the values

= 10/100 × 2000

= $200

Therefore, the reserves amount is $200.

A bank’s reserve ratio is 10 percent and the bank has $2,000 in deposits. Its reserves amount to

Summary:

A bank’s reserve ratio is 10 percent and the bank has $2,000 in deposits. Its reserves amount to $200.