Suppose That Banks Desire to Hold No Excess Reserves the Reserve

question 75

Multiple Choice

Suppose that banks desire to hold no excess reserves the reserve ratio is 5 percent and a bank receives a new deposit of $1,000.This bank

• A)will increase its required reserves by $50.
• B)will initially see its total reserves increase by $1,000.
• C)will be able to make a new loan of $950.
• D)All of the above are correct.

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Definitions:

One Child Policy

A former birth control policy of China aimed at controlling the population by limiting families to only one child with few exceptions.

Human Resource Problems

Issues related to the management of employees within an organization, including recruitment, employment, and retention.

Developing Nations

Countries with lower levels of industrialization, lower standards of living, and lower Human Development Index (HDI) ratings compared to more industrialized nations.