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17 July, 10:27

Suppose you deposit $800800 cash into your checking account. By how much will checking deposits in the banking system increase as a result when the required reserve ratio is 0.44 0? The change in checking deposits is equal to: $nothing (enter your result rounded to the nearest dollar ).

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Answers (1)
  1. 17 July, 12:33
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    Change in checking deposit is $18,20,000

    Explanation:

    Checking account is the kind or form of deposit account that is held at a institution and it allows the deposits as well as withdrawals.

    The change in the checking deposit is computed as:

    Change in Checking deposit = Deposit amount / Required reserve ratio

    where

    Demand deposit is $800,800

    Required reserve ratio is 0.440

    Putting the values above:

    Change in checking deposit = $800,800 / 0.440

    Change in checking deposit = $18,20,000
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