Suppose Bank a Has $1000 in Deposits and $100 in Reserves

question 176

Multiple Choice

Suppose Bank A has $1000 in deposits and $100 in reserves. If the desired reserve ratio is 8 percent, how much can this bank lend?

• A) $800
• B) $720
• C) $20
• D) $80

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Definitions:

Chronic Schizophrenia

A long-term, severe psychiatric disorder characterized by delusions, hallucinations, disorganized speech or behavior, and other symptoms that impair daily functioning.

Responsive

Showing a positive or quick reaction to something, especially to changes, suggestions, or stimuli.

Treatment

The application of remedies to relieve or cure a disease, disorder, or injury.

Rumination

The process of continuously thinking about the same thoughts, which are often sad or dark, leading to emotional distress.