Assume we have a simplified banking system in balance-sheet equilibrium. Also assume that all banks are subject to a uniform 10 percent reserve requirement and demand deposits are the only form of money. A commercial bank receiving a new demand deposit of $100 would be able to extend new loans in the amount of: Group of answer choices $1,000. $10. $100. $90.
Assume we have a simplified banking system in balance-sheet equilibrium. Also assume that all banks are subject to a uniform 10 percent reserve requirement and demand deposits are the only form of money. A commercial bank receiving a new demand deposit of $100 would be able to extend new loans in the amount of: Group of answer choices $1,000. $10. $100. $90.
Chapter25: Money Creation
Section: Chapter Questions
Problem 6SQ
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Assume we have a simplified banking system in balance-sheet equilibrium. Also assume that
all banks are subject to a uniform 10 percent reserve requirement and demand deposits are
the only form of money. A commercial bank receiving a new demand deposit of $100 would
be able to extend new loans in the amount of:
all banks are subject to a uniform 10 percent reserve requirement and demand deposits are
the only form of money. A commercial bank receiving a new demand deposit of $100 would
be able to extend new loans in the amount of:
Group of answer choices
$1,000.
$10.
$100.
$90.
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