Scenario 16-2
Imagine that Kristy deposits $10,000 of currency into her checking account deposit at Bank A and that the required reserve ratio is 20%.
-Refer to Scenario 16-2.As a result of Kristy's deposit,Bank A can make a maximum loan of

Question

Quizplus · Accepted Answer

The required reserve ratio of 20% means that Bank A must keep 20% of Kristy's deposit ($2,000) as reserves and can loan out the remaining 80% ($8,000). Therefore, Bank A can make a maximum loan of $8,000.

Scenario 16-2 Imagine That Kristy Deposits $10,000 of Currency into Her Checking