Table 21-4. -Refer to Table 21-4.If the Bank Faces a Reserve Requirement

question 21

Multiple Choice

Table 21-4.

-Refer to Table 21-4.If the bank faces a reserve requirement of 10 percent,then the bank

• A) is in a position to make a new loan of $10,000.
• B) has fewer reserves than are required.
• C) has excess reserves of $12,500.
• D) None of the above is correct.

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Definitions:

Industry Supply Curve

A graphical representation showing the relationship between the price of a good and the total output of the industry as a whole.

Price of An Input

The cost associated with purchasing goods or services used in the production process.

Breaking Even

The point at which total revenues exactly equal total expenses, resulting in no net profit or loss.

Produce

To create or manufacture goods and services for consumer use, often involving a combination of raw materials, labor, and machinery.