Consider the Following Information About a Banking System: New Currency

question 105

Multiple Choice

Consider the following information about a banking system: new currency deposited in the system = $40 billion, legal reserve ratio = 0.20, excess reserves prior to the currency deposit = $0. With the $40 billion deposit, the
Banking system will be able to expand the money supply through loans by

• A) $160 billion.
• B) $200 billion.
• C) $40 billion.
• D) $128 billion.

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Definitions:

Base-Pair Substitution

A type of genetic mutation where one base pair in the DNA sequence is replaced by another pair, which can lead to changes in the protein made by a gene.

Amino Acid

Organic compounds that serve as the building blocks of proteins, playing critical roles in biological processes.

Eukaryotic mRNA

Messenger RNA in eukaryotes, which is synthesized from DNA and carries genetic information from the nucleus to the ribosome for protein synthesis.

Half Life

The time required for half of the atoms in a sample of a radioactive element to decay into a different isotope or element.