If a Bank Receives a New Transaction Deposit of $10,000

question 461

Multiple Choice

If a bank receives a new transaction deposit of $10,000 and the reserve ratio is 15 percent, then the bank could expand its loans by as much as

• A)$1,500.
• B)$8,500.
• C)$15,000.
• D)$66,700.

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Definitions:

Per Capita Income

The average income earned per person in a specific area or country.

World's Income

The total amount of economic output or earnings generated globally within a specific time period.

Productive Resources

The inputs used in the production of goods and services, typically categorized into land, labor, and capital.

Population Growth Rate

The population growth rate is a measure of how the number of individuals in a population increases or decreases over time, usually expressed as a percentage.