Suppose a Bank Has $100,000 in Deposits,a Required Reserve Ratio

question 91

Multiple Choice

Suppose a bank has $100,000 in deposits,a required reserve ratio of 20 percent,and total reserves of $20,000.Then this bank can make new loans in the amount of

• A)$100,000.
• B)$20,000.
• C)$40,000.
• D)$0.

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Definitions:

Preoperational

A stage in Piaget's theory of cognitive development (approximately ages 2-7) where children begin to engage in symbolic play but lack the ability to perform operations or use logic.

Coax

To persuade someone gently and persistently to do something or to obtain something by using flattery or gentle urging.

Egocentrism

The inability to differentiate between one's own perspective and someone else's, often observed in early child development.

Anthropomorphism

The attribution of human traits, emotions, or intentions to non-human entities, including animals, natural phenomena, or objects.