If the Reserve Ratio Is 20 Percent and Reserves in the Commercial

question 312

Multiple Choice

If the reserve ratio is 20 percent and reserves in the commercial banking system increase by $10,000, the maximum possible expansion of demand deposits is

• A) $10,000.
• B) $80,000.
• C) $50,000.
• D) $500,000.

---

Definitions:

Paralegal

A professional trained in legal matters who assists attorneys in their work but is not licensed to practice law themselves.

Attorney

A legal professional authorized to practice law, representing clients in legal matters and providing advice.

Alternate Jurors

Additional jurors selected during a trial who will step in should any of the main jurors be unable to continue serving.

Civil Trial

A judicial process to resolve disputes between private parties, organizations, or government entities, where the result typically involves compensation or the enforcement of rights rather than criminal penalties.