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 ).

Question

Sharon Douglas

Business

23 July, 14:33

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)

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Caylen · Answer 1

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