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If a Bank Receives a Deposit of $3,000 and Loans

Question 112

Multiple Choice

If a bank receives a deposit of $3,000 and loans out $2,000,what changes will occur on the bank's balance sheet (after all checks involved with the loan are cleared) ?


A) Reserves decrease by $3,000,total assets decrease by $1,000,and total liabilities increase by $3,000.
B) Reserves increase by $1,000,total assets increase by $2,000,and total liabilities increase by $3,000.
C) Reserves increase by $3,000,total assets by increase $3,000,and total liabilities increase by $3,000.
D) Reserves increase by $3,000,total assets by increase $2,000,and total liabilities decrease by $3,000.
E) Reserves increase by $1,000,total assets increase by $3,000,and total liabilities increase by $3,000.

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