If Banks Were Required to Keep 100% of Deposits in Reserves

question 6

Multiple Choice

If banks were required to keep 100% of deposits in reserves, they could:

• A) make more loans.
• B) make no loans.
• C) make more deposits.
• D) use excess reserves for loans.

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Definitions:

Postcentral Gyrus

A region of the cerebral cortex located immediately posterior to the central sulcus, responsible for processing somatosensory information.

Precentral Gyrus

The region of the cerebral cortex located in the frontal lobe, directly involved in controlling voluntary movements.

Prefrontal Gyrus

A portion of the frontal lobe in the brain, important for higher cognitive functions such as decision-making and social behavior.

Central Sulcus

A prominent landmark of the brain, separating the frontal lobe from the parietal lobe, playing a key role in dividing areas involved in motor and sensory functions.