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Question
A bank currently has $50 million in deposits, $6 million in cash in the vault, $4 million on deposit with the Fed, and $5 million in government securities. The reserve ratio is 20 percent. A new deposit is made of $1 million. What is the maximum size loan the bank can make once the check clears?
A) 0
B) $800,000
C) $1 million
D) $5.8 million
Answer
This answer is hidden. It contains 1 characters.
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