Multiple Choice
A-1 bank initially has no excess reserves.If the desired reserve ratio is 10 percent and a new deposit of $10,000 is made in A-1,then A-1
A) is required to hold the deposit in its reserves.
B) can immediately loan a multiple of the $10,000.
C) can immediately loan $9,000.
D) can immediately loan $100,000.
E) can immediately loan $10,000.
Correct Answer:
Verified
Correct Answer:
Verified
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