Exhibit 19-7 Lower Walloon National Bank In Exhibit 19-7, if Mr. Brown pays out all of the proceeds of the loan to Mr. John White who is going to make the renovations of the restaurant, the Lower Walloon National bank will now have:

Question

Exhibit 19-7  Lower Walloon National Bank  In Exhibit 19-7, if Mr. Brown pays out all of the proceeds of the loan to Mr. John White who is going to make the renovations of the restaurant, the Lower Walloon National bank will now have:

Quizplus · Accepted Answer

If Mr. Brown pays out all of the proceeds of the loan to Mr. John White, the bank's reserves will decrease by the amount of the loan (which is $8,000), leaving the bank with $2,000 in reserves. The bank's loans will increase by $8,000 to a total of $8,000. The checkable deposits will remain the same, at $10,000. Therefore, the correct choice is C.

Exhibit 19-7 Lower Walloon National Bank in Exhibit 19-7, If