Suppose a Bank Has a Desired Reserve Requirement Ratio of 12

question 21

Multiple Choice

Suppose a bank has a desired reserve requirement ratio of 12 percent. If someone deposits $1,000 in the bank

• A) immediately after the deposit, unplanned reserves increase by $880.
• B) the bank can make loans of $1,000.
• C) the bank's desired reserves rise by $1,000.
• D) immediately after the deposit, excess reserves increase by $880.

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Definitions:

Active Phase

In the context of psychiatric disorders like schizophrenia, a period during which symptoms are most pronounced and interfere significantly with daily functioning.

Six Months

A half-year period, or a duration of approximately 182 to 183 days, depending on the inclusion of a leap day.

Delusional

Holding beliefs that are clearly false, illogical, or based on incorrect inferences about external reality, despite evidence to the contrary.

Type I

Commonly refers to a classification in various contexts, often seen in medical or technological fields, indicating a particular form or category within a larger grouping.