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Answer the Question on the Basis of the Following Consolidated

Question 66

Multiple Choice

Answer the question on the basis of the following consolidated balance sheet for the commercial banking system.Assume the required reserve ratio is 10 percent.All figures are in billions.  Assets Reserves Securities Loans Property$3013070200 Liabilities & Net Worth  Checkable Deposits Stock Shares$300130\begin{array}{c}\begin{array}{lll}\quad\quad\quad\underline{\text { Assets}}\\\text { Reserves}\\\text { Securities}\\\text { Loans}\\\text { Property} \end{array}\begin{array}{l}\\\$30\\130 \\70\\200\end{array}\begin{array}{lll}\quad\quad \underline{\text { Liabilities \& Net Worth }}\\\text { Checkable Deposits}\\\text { Stock Shares}\\\\\\\end{array}\begin{array}{lll}\\\$300\\130\\\\\\\end{array}\end{array} Refer to the data.After the deposit of $10 billion of new currency,the maximum amount by which this commercial banking system can expand the supply of money by lending is:


A) $9 billion.
B) $45 billion.
C) $36 billion.
D) $90 billion.

Correct Answer:

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