The Balance Sheet Below Is for the First Federal Bank

Multiple Choice

The balance sheet below is for the First Federal Bank. Assume the required reserve ratio is 20 percent. Refer to the above information. If the original bank balance sheet was for the whole commercial banking system rather than a single bank, loans and deposits could have been expanded by a maximum of:

A) $40,000
B) $100,000
C) $200,000
D) $300,000