Answered

At Westonci.ca, we provide reliable answers to your questions from a community of experts. Start exploring today! Get immediate and reliable solutions to your questions from a community of experienced professionals on our platform. Our platform provides a seamless experience for finding reliable answers from a network of experienced professionals.

a bank receives a deposit of $25,000. if the reserve ratio is 25 percent, the loan creation process can potentially create of new money.

Sagot :

tutorconsortium122

A bank receives a deposit of $25,000. if the reserve ratio is 25 percent,The loan creation process can potentially create of new money $6250

Explanation:

Reserve Ratio = Reserve maintained with Central Bank / Bank Deposits * 100%

25% of 25000

=25/100*25000

=6250

What is Reserve ratio?

  • The term "reserve ratio" describes the percentage of total deposits that commercial banks are required to hold in cash reserves at the central bank; these reserves cannot be used for any commercial lending.
  • The country's central bank, in the instance of the United States, the Federal Reserve, determines the reserve ratio requirement.
  • The calculation for a bank can be obtained by dividing the bank deposits by the cash reserve held with the central bank, and it is expressed as a percentage.
  • Reserve Ratio = Reserve maintained with Central Bank / Bank Deposits * 100%

To learn more about Reserve ratio refer to :

https://brainly.com/question/13758092

#SPJ4

We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. Thank you for choosing our platform. We're dedicated to providing the best answers for all your questions. Visit us again. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.