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The following table is the consolidated balance sheet for the commercial banking system. All figures are in billions. Assume that the required reserve ratio is 10 percent: Assets Liabilities + Net Worth Reserves $120,000 Checkable Deposits $300, Loans 140,000 Stock Shares 200 Securities 40,000 Property 200,000 Refer to the above information. The maximum amount by which this commercial banking system can expand the supply of money by lending is: A) $120,000 billion B) $300,000 billion C) $600,000 billion D) $900,000 billion

The following table is the consolidated balance sheet for the commercial banking system. All figures are in billions. Assume that the required reserve ratio is 10 percent: Assets Liabilities + Net Worth Reserves $120,000 Checkable Deposits $300, Loans 140,000 Stock Shares 200 Securities 40,000 Property 200,000 Refer to the above information. The maximum amount by which this commercial banking system can expand the supply of money by lending is: A) $120,000 billion B) $300,000 billion C) $600,000 billion D) $900,000 billion

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter21: The Monetary System
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The following table is the consolidated balance sheet for the commercial banking system. All figures are in billions. Assume that the required reserve ratio is 10 percent: Assets Liabilities + Net Worth Reserves $120,000 Checkable Deposits $300, Loans 140,000 Stock Shares 200 Securities 40,000 Property 200,000 Refer to the above information. The maximum amount by which this commercial banking system can expand the supply of money by lending is: A) $120,000 billion B) $300,000 billion C) $600,000 billion D) $900,000 billion
Transcribed Image Text:The following table is the consolidated balance sheet for the commercial banking system. All figures are in billions. Assume that the required reserve ratio is 10 percent: Assets Liabilities + Net Worth Reserves $120,000 Checkable Deposits $300, Loans 140,000 Stock Shares 200 Securities 40,000 Property 200,000 Refer to the above information. The maximum amount by which this commercial banking system can expand the supply of money by lending is: A) $120,000 billion B) $300,000 billion C) $600,000 billion D) $900,000 billion
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