If the Reserve Requirement Is 2

question 38

Multiple Choice

If the reserve requirement is 2.5% and a bank initially receives $30,000 in deposits from the Fed, then the maximum amount of money that the banking system can create is:

• A) $750.
• B) $1,500.
• C) $30,000.
• D) $1.2 million.

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Definitions:

Depression

A mental health disorder characterized by persistently depressed mood or loss of interest in activities, causing significant impairment in daily life.

Important Relationships

Bonds or connections between individuals that are considered significant or valuable, often influencing well-being and behavior.

Stressful Day

A day filled with high levels of stress, often due to challenging or overwhelming situations.

Bipolar Disorder

A mental disorder that causes unusual shifts in mood, energy, activity levels, and the ability to carry out day-to-day tasks.