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:

Answer 1

0.05

To find the required reserve ratio, we need to know the total deposits and the required reserves amount.

Next, we divide the required reserve amount by the total deposits.
$10,000 / $200,000 = 0.05

The 0.05 is the required reserve ratio for First Bank of Commerce.