A Customer of a Bank Needs Additional Currency and Cashes

question 79

Multiple Choice

A customer of a bank needs additional currency and cashes a check for $10,000.The reserve requirement is 20%.The bank has no excess reserves.It must:

• A)refuse the check
• B)get an additional $8,000 of reserves
• C)get an additional $2,000 of reserves
• D)none of the above

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Definitions:

Loss Averse

The tendency of individuals to prefer avoiding losses to acquiring equivalent gains, a fundamental behavior observed in economic and financial decision-making.

Framing Effect

A cognitive bias in which the way information is presented affects decision-making or judgments, leading individuals to alter their interpretation based on the "frame" of reference.

Identical Situations

Circumstances or scenarios where all relevant factors and conditions are exactly the same for all parties involved.

Different Contexts

The varying situations, circumstances, or environments in which a concept or term can be applied or understood.