If a Bank Receives a New Checkable Deposit of $10,000

question 129

Multiple Choice

If a bank receives a new checkable deposit of $10,000, and the required reserve ratio is 20 percent, then the bank can lend out:

• A) $2,000.
• B) $10,000.
• C) $40,000.
• D) $8,000.
• E) $0.