Multiple Choice
If the reserve ratio is 10 percent and a bank receives a new deposit of $20, which of the following happens to this bank's reserves or deposits?
A) Required reserves must increase by $2.
B) Total reserves will increase by $2.
C) New loans can be made up to a maximum of $2.
D) Total reserves increase by $200.
Correct Answer:
Verified
Correct Answer:
Verified
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