If a Bank Has a Required Reserve Ratio of 25

question 59

Multiple Choice

If a bank has a required reserve ratio of 25% and there is $10,000 in deposits,what is the maximum amount of loans that can be made by this bank?

• A) $40,000
• B) $10,000
• C) $0
• D) $2,500
• E) $7,500

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Definitions:

Cardiomyopathy

A condition affecting the heart muscle, leading to a decreased ability for the heart to circulate blood throughout the body.

Blue

A color in the spectrum visible to the human eye, occupying the band approximately halfway between green and violet.

Musculoskeletal

Referring to the system of muscles and skeletons in the body and its related disorders.

Nephrology

The branch of medicine that deals with the functions and diseases related to the kidneys.