Assignment:
Balance sheet of the Summer Bank
|
Assets
|
Liabilities
|
|
Cash $ 15,000
Loans $ 185,000
|
Deposits $ 120,000
Capital $ 80,000
|
|
Total $ 200,000
|
Total $ 200,000
|
The required reserve ratio on all deposits is 12%
a. What, if any, are this bank's excess reserves?
b. How much new amount of loan will this bank be able to create because of the excess reserves?
c. Answer part a and b if the required reserve ratio is changed to 8%.