alance sheet of the Summer bank Assets Liabilities   Cash                                 $ 8,000 Deposited with the Fed   $ 6,000   Loans                               $ 116,000      Deposits $ 80,000   Capital    $ 50,000 Total                                 $ 130,000 Total          $ 130,000   The required reserve ratio (RRR) on all deposits is 8% 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?

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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  Balance sheet of the Summer bank

Assets

Liabilities

 

Cash                                 $ 8,000

Deposited with the Fed   $ 6,000

 

Loans                               $ 116,000 

 

 

Deposits $ 80,000

 

Capital    $ 50,000

Total                                 $ 130,000

Total          $ 130,000

 

The required reserve ratio (RRR) on all deposits is 8%

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?

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