If a Bank Sells a $1,000 Security to the Fed

question 63

Multiple Choice

If a bank sells a $1,000 security to the Fed and the required reserve ratio is 10 percent, _____

• A) the bank has $1,000 in additional reserves, of which it can lend $800.
• B) the bank has $1,000 in additional reserves, of which it can lend $900.
• C) the bank has lost an asset and must reduce its loans.
• D) the bank has lost a liability.
• E) there is no change in excess reserves, since net assets do not change.

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Definitions:

Quantitative Trait

Characteristics or phenotypes that vary in degree and can be attributed to polygenic effects, such as height or skin color.

Recessive Trait

A genetic trait that is expressed only when two copies of the gene are present, one from each parent.

Wing Phenotypes

The observable characteristics or traits of an organism's wings, including shape, size, color, and pattern, which can vary significantly among species.

Genetic Locus

A precise, set location on a chromosome that is the site of a specific gene or genetic marker.