If a Bank Desires to Hold No Excess Reserves, the Reserve

question 273

Multiple Choice

If a bank desires to hold no excess reserves, the reserve requirement is 5 percent, and it receives a new deposit of $1,000

• A)its required reserves increase by $50.
• B)its total reserves initially increase by $1,000.
• C)it will be able to make a new loan of up to $950.
• D)All of the above are correct.

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