Again, please consider the following simplified balance sheet for Big Bank: Assets Liabilities and Equity Reserves...
Again, please consider the following simplified balance sheet for Big Bank:
| Assets | Liabilities and Equity |
|
Reserves $40 |
Deposits $200 Equity $???? |
You can assume that all deposits are checking deposits and that the reserve ratio is 10%. Also, assume there's no other relevant information except what's given here.
2. Calculate the amount this bank is required to hold in reserves, carefully following all numeric instructions.
Homework Answers
| Assets | Liabilities and Equity |
|
Reserves $40 |
Deposits $200 Equity $100 |
Since Both side should be equal, So,
Equity = (40 + 260) - 200 = $100
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