Table 29-5. -Refer to Table 29-5. Suppose the Bank Faces a Reserve

question 401

Multiple Choice

Table 29-5.
-Refer to Table 29-5. Suppose the bank faces a reserve requirement of 10 percent. Starting from the situation as depicted by the T-account, a customer deposits an additional $60,000 into his account at the bank. If the bank takes no other action it will

• A)have $64,000 in excess reserves.
• B)have $4,000 in excess reserves.
• C)be in a position to make new loans equal to $6,000
• D)None of the above is correct.

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