If a Bank Has $6,000 in Checkable Deposits and the Required

question 57

Multiple Choice

If a bank has $6,000 in checkable deposits and the required reserve ratio is 0.2,then the bank can lend:

• A)$4,000.
• B)$16,000.
• C)no more than $4,800.
• D)no less than $3,000.
• E)$1,000.

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Definitions:

Service Charge

A fee collected for services provided, often added to bills in restaurants, hotels, or banking services.

Reconciled Balance

The balance of an account after accounting discrepancies have been resolved and all entries have been made.

Bank Statement

A document or record provided by a bank, detailing all transactions in an account over a specific period.

Checkbook Balance

The amount of money available in an account, tracking all deposits and withdrawals recorded in the checkbook register.