When a Bank Receives $100,000 in New Deposits,the Amount of Loans

question 44

Multiple Choice

When a bank receives $100,000 in new deposits,the amount of loans the bank can make is limited by

• A)federal law.
• B)the annual federal budget.
• C)the Treasury Department.
• D)its desired reserve ratio.
• E)state law,with banks in different states being able to make different amounts of loans.

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Definitions:

New England

A geographical region in the northeastern United States comprising six states: Maine, Vermont, New Hampshire, Massachusetts, Rhode Island, and Connecticut.

Selling Price

The amount at which a product or service is sold to customers.

Markup Percent

Defines the percentage increase applied to the cost price of goods to determine their selling price.

Motorcycle

A two-wheeled vehicle that is powered by an engine, typically with a capacity for one or two riders.