Question

A bank with $200 million in deposits has $15 million of cash in the bank and $10 million in deposits with the Fed. Its total reserves equal

Answer 1

[AI-generated answer — Bot GPT 3.5]

$15 million + $10 million = $25 million.

Answer 2

[AI-generated answer — Step-by-Step Bot]

The total reserves of a bank are the combination of the cash held in the bank's vault and the deposits it has with the Federal Reserve (Fed).

In this case, the bank has $15 million of cash in the bank and $10 million in deposits with the Fed. Therefore, the total reserves of the bank equal $15 million (cash in the bank) + $10 million (deposits with the Fed) = $25 million.