A bank's reserve ratio is 7 percent and the bank has $1,000 in deposits. Its reserves amount to

A) $930.
B) $70.
C) $7.
D) $93.

Reserve Ratio

The fraction of depositors' balances that banks must have on hand as cash, a regulation enforced by central banking authorities.

Reserves

Funds or materials set aside or saved for future use or to cover unforeseen expenses; in banking, it refers to the fraction of deposits that a bank keeps in hand to ensure liquidity.

Deposits

Funds placed into an account at a financial institution for safekeeping, which can include savings accounts, checking accounts, and certificates of deposit.