Answer the Question on the Basis of the Following Information

question 87

Multiple Choice

Answer the question on the basis of the following information about a banking system: new currency deposited in the system = $40 billion;legal reserve ratio = 0.20;excess reserves prior to the currency deposit = $0. Refer to the information.The $40 billion deposit of currency into checking accounts will create excess reserves of:

• A) $20 billion.
• B) $32 billion.
• C) $40 billion.
• D) $0.

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Definitions:

Seawater

The saltwater that makes up the oceans and seas, covering more than 70% of the Earth's surface.

Sediment

Particles of organic or inorganic matter that settle out of suspension in water, air, or ice, and accumulate in layers on the earth's surface.

Energetic Current

Refers to a strong, dynamic movement of water, often in the ocean, that can transport sediments and influence marine and coastal processes.

Moving

The act or process of changing location or position.