Suppose You Deposit $1,000 Cash in Your Checking Account at a Bank

question 175

Multiple Choice

Suppose you deposit $1,000 cash in your checking account at a bank. If the bank is loaned up and if the required reserve ratio is 10%, the maximum amount that the bank can lend now, following your deposit is

• A) $100.
• B) $900.
• C) $1,000.
• D) $10,000.

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