Table 122 -Refer to Table 12

Table 12.2
$\begin{array}{c}\text { Balance Sheet }\\\quad\quad\quad\text { Assets } \quad\quad\quad\quad\quad\quad\quad\quad \text { Liabilities }\\\begin{array}{|c|c|c|c|}\hline\text { Cash } & \$ 5,000 & \begin{array}{c}\text { Demand } \\\text { Deposits }\end{array} & \$ 20,000 \\\hline \text { Loans } & 15,000 & & \\\hline \text { Total Assets } & \$ 20,000 & \text { Total Liabilities } & \$ 20,000 \\\hline\end{array}\end{array}$


-Refer to Table 12.2. With a reserve requirement of 20 percent, the bank has excess reserves of _____.

A) $5,000
B) $3,000
C) $2,000
D) $1,000
E) $2,500

Correct Answer:

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