When $1 Million Is Deposited at a Bank,the Required Reserve

question 48

Multiple Choice

When $1 million is deposited at a bank,the required reserve ratio is 20 percent,and the bank chooses not to hold any excess reserves but instead makes loans,then in the bank's final balance sheet,

• A) the assets at the bank increase by $200,000.
• B) the liabilities of the bank increase by $200,000.
• C) reserves increase by $200,000.
• D) all of the above occur.