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Use the Following to Answer Questions

Question 203

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Use the following to answer questions .
Exhibit: Reserves, Loans, and Money
Use the following to answer questions . Exhibit: Reserves, Loans, and Money -(Exhibit: Reserves, Loans, and Money) If the required reserve ratio is 10% and the market interest rate is 8%, what is Bolton Bank's opportunity cost of holding the excess reserves it is currently holding? A) $5.6 million B) $3.2 million C) $0.8 million D) 0; Bolton Bank has no excess reserves.
-(Exhibit: Reserves, Loans, and Money) If the required reserve ratio is 10% and the market interest rate is 8%, what is Bolton Bank's opportunity cost of holding the excess reserves it is currently holding?


A) $5.6 million
B) $3.2 million
C) $0.8 million
D) 0; Bolton Bank has no excess reserves.

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