A bank has $25 million in deposits and maintains a reserve ratio of 0.2. What are its total reserves in millions of dollars?

Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter13: Money And The Banking System
Section: Chapter Questions
Problem 5CQ
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A bank has $25 million in deposits and maintains a reserve ratio of 0.2. What are its total reserves in millions of dollars?

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