Assume That a Bank Has $2 Million in Reserves and Checkable

Assume that a bank has $2 million in reserves and checkable deposits of $10 million and the required reserve ratio on checkable deposits is 20%.The maximum amount of new loans this bank can make is

A) $500,000.
B) $1 million.
C) $200,000.
D) zero.
E) $700,000.