XYZ Bank has $1,000,000 in total deposits and a required reserve ratio of 10%. If the bank has $150,000 in actual reserves, what is the impact on its ability to lend money, and what does this indicate about their excess reserves?

XYZ Bank has a required reserve ratio of 10%, which means it must keep 10% of its total deposits as reserves. With $1,000,000 in deposits, the bank needs to keep $100,000 as required reserves. Since it actually has $150,000 in reserves, it has $50,000 in excess reserves, which is the money it can lend out. This ability to lend more money indicates that the bank is in a healthy position, as it not only meets the required reserves but also has additional funds available to support loans. Therefore, with $50,000 in excess reserves, the bank can help more customers by providing loans, which can stimulate growth in the economy.