With a Required Reserve Ratio of 20 Percent,an Increase in Reserves

question 108

Multiple Choice

With a required reserve ratio of 20 percent,an increase in reserves of $10,000 could lead to a maximum increase in checking account deposits in the entire banking system of

• A)$2,000.
• B)$8,000.
• C)$50,000.
• D)$100,000.

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Definitions:

Enforce

To compel observance of or obedience to a law, rule, or obligation.

Minor

An individual under the age of majority, legally considered not yet fully capable of taking on certain responsibilities and rights.

Contractual Purposes

The intended aims or goals that parties seek to achieve through entering into a contract.

Covenant Not to Compete

A legal agreement in which one party agrees not to enter into or start a similar profession or trade in competition against another party.