Question

A bank has an 8 percent reserve requirement, $10,000 in deposits, and has loaned out all it can, given the reserve requirement. a. It has $1,250 in reserves and $8,750 in loans. b. It has $8,000 in reserves and $2,000 in loans. c. It has $800 in reserves and $9,200 in loans. d. It has $80 in reserves and $9,920 in loans.

Answer 1

c. It has $800 in reserves and $9,200 in loans.

Step-by-step explanation:

Calculation to determine the given reserve requirement

Reserves=8%*$10,000

Reserves=$800

Loans=$10,000-$800

Loans=$9,200

Therefore given the reserve requirement It has $800 in reserves and $9,200 in loans.