The Following Question Refer to the Table That Follows

question 51

Multiple Choice

The following question refer to the table that follows. Assume that there is a fractional-reserve banking system, that the legal reserve requirements are 10 percent, and that the balance sheet for Bank X is as follows:

-Bank X has legal reserve requirements of

• A) $3,000,000.
• B) $2,000,000.
• C) $1,667,000.
• D) $1,000,000.
• E) $0.

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Definitions:

Efficient

Describes a system or process that operates in a way that maximizes productivity or output with minimal waste or expense.

External Cost

A cost that is not borne by the parties involved in an economic transaction, often affecting third parties.

Zoning Restrictions

Legal regulations governing how land within certain areas can be used, intended to separate residential property use from commercial and industrial uses.

Land Defilement

Refers to the degradation or contamination of land due to misuse or improper disposal of waste.