If the Reserve-Deposit Ratio Is 25% and the Banking System

question 90

Multiple Choice

If the reserve-deposit ratio is 25% and the banking system receives an additional $10 million in reserves,bank deposits will increase by

• A) $10 million.
• B) $250 million.
• C) $400 million.
• D) $4 million.
• E) $40 million.

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Definitions:

Reposition

The act or process of placing or arranging something in a different position.

Excursion

The movement of a structure or part away from its resting position, often used in the context of muscle movement or joint mobility.

Extension

The movement by which the two ends of any jointed part are drawn away from each other, increasing the angle between them.

Adduction

The movement of a limb or other body part toward the midline of the body or toward another body part.