A Bank Has a Withdrawal of $1,000

question 36

Multiple Choice

A bank has a withdrawal of $1,000.If the bank has no excess reserves and if there is a 15 percent reserve requirement,

• A)it must reduce its loans by $1,000.
• B)it must reduce its loans by $850.
• C)it must reduce its loans by $150.
• D)it need not reduce its loans.

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Definitions:

Water

A transparent, tasteless, odorless, and nearly colorless chemical substance that is the main constituent of Earth's streams, lakes, and oceans, and the fluids of most living organisms.

Fermentation

A metabolic process that produces chemical changes in organic substrates through the action of enzymes, leading to the production of energy in the absence of oxygen.

ATP Production

The process by which cells generate adenosine triphosphate (ATP), the main energy currency of the cell, through pathways such as cellular respiration or photosynthesis.

Animals

Multicellular, eukaryotic organisms of the kingdom Animalia that are capable of locomotion, responsive to their environment, and feed by consuming other organisms.