EduFarming
Your list · 0हिं

Type at least two letters. Press Esc to close.

↑↓ navigate↵ openTAB cycle filter

Money Creation by Banks · Question 15 of 58

Question 15

MediumOriginal question

A bank has deposits of ₹1,000 crore and reserves of ₹250 crore. The required reserve ratio is 20%. Its excess reserves are

Options for question 15

Show the answer and explanation
CorrectNot quiteAnswer A

Correct answer: A

Explanation

  1. Required reserves = 20% of 1,000 = 200.

  2. Excess reserves = 250 − 200 = ₹50 crore, which the bank could lend.

Concept
Excess reserves
Typical time
70 s
Your time
—
The rule this testsReserves and the reserve ratio
Practise this chapter →

Ten questions from Money Creation by Banks, at your own pace.

Practise this chapter →

Ten questions from Money Creation by Banks, at your own pace.

Practise this chapterAll 58 questions in Money Creation by BanksRevise the notes for Money Creation by Banks