Suppose $50 comma 000 is deposited at a bank. The required reserve ratio is 20 percent, and the bank chooses not to hold any excess reserves but makes loans instead. What are the bank's total reserves?

And provided the company do not have any amount more than the required reserve, therefore balance in reserve = $50,000 [tex]\times[/tex] 20% = $10,000

Further remaining $50,000 - $10,000 = $40,000 will be advanced as loan, and will not form part of reserves.

Therefore, total reserve's of bank = $10,000

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Suppose ​$50 comma 000 is deposited at a bank. The required reserve ratio is 20 ​percent, and the bank chooses not to hold any excess reserves but makes loans instead. What are the​ bank's total​ reserves?

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Suppose $50 comma 000 is deposited at a bank. The required reserve ratio is 20 percent, and the bank chooses not to hold any excess reserves but makes loans instead. What are the bank's total reserves?