Assume the Reserve Requirement Is 10% and All Banks Are

question 57

Multiple Choice

Assume the reserve requirement is 10% and all banks are fully loaned up.If a new deposit of $10,000 is made into Bank X,with this deposit Bank X can make new loans of:

• A) $9,000.
• B) $10,000.
• C) $1,000.
• D) $11,000.

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Definitions:

Communications Decency Act

A section of U.S. federal law designed to regulate pornographic material on the internet, providing immunity to online platforms from liability for user-generated content.

Fire

A rapid oxidation process, which is a chemical reaction resulting in heat, light, and flame; can cause damage or destruction to objects or environments.

Covenant of Quiet Enjoyment

A lease agreement promise that the tenant has the right to freely use the property without interference from the landlord or other claims.

Upstairs Tenant

A person or entity that resides or operates in the upper floors of a multi-story building, often in the context of residential leasing.