Multiple Choice
If the reserve requirement is 5 percent,a bank desires to hold no excess reserves,and it receives a new deposit of $10,then this bank
A) must increase its required reserves by $10.
B) will initially see its total reserves increase by $10.50.
C) will be able to make new loans up to a maximum of $9.50.
D) All of the above are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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