An individual bank can, at most, lend out all of its
A) checkable deposits.
B) excess reserves.
C) reserves.
D) deposits.

Name: An individual bank can, at most, lend out all of its A) checkable deposits. B) excess reserves. C) reserves. D) deposits.
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Question

Quizplus · Accepted Answer

Excess reserves are the only funds that banks can lend out without violating the reserve requirements set by the central bank. Therefore, a bank can lend out at most all of its excess reserves.

An Individual Bank Can, at Most, Lend Out All of Its