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Question
The Shirley State Bank has $90 million in transaction deposits subject to legal reserves. The bank must hold 3 percent legal reserves up to $43.9 million of transaction deposits and 10 percent legal reserves on any amount above this. What is the bank's total legal reserve requirement?
A. $2.700 million
B. $1.449 million
C. $5.927 million
D. $4.170 million
E. None of the options is correct
Answer
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