Table 29-2.An economy starts with $10,000 in currency.All of this currency is deposited
into a single bank,and the bank then makes loans totaling $9,250.The
T-account of the bank is shown below.

-Refer to Table 29-2.This bank operates in a

Question

Table 29-2.An economy starts with $10,000 in currency.All of this currency is deposited
into a single bank,and the bank then makes loans totaling $9,250.The
T-account of the bank is shown below.
 
-Refer to Table 29-2.This bank operates in a

Quizplus · Accepted Answer

The T-account shows that the bank has made loans totaling $9,250 but still holds $750 in reserves (cash and deposits with the Fed). This indicates that the bank is operating under a fractional-reserve banking system, where banks are required to hold only a fraction of their deposits in reserves and can lend out the rest.