Question

Suppose total deposits in the First Bank of Commerce are $200,000 and required reserves are $10,000. Based on this information, the required reserve ratio is: Multiple Choice 20.0. 0.05. 0.20. 0.10.

Answer 1

0.05

Step-by-step explanation:

the required reserve ratio is the ratio of deposits that should be kept as reserves by deposit accepting banks.

$10,000 / $200,000 = 0.05