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D 5. A new bank opens up and quickly receives $5,000 in deposits. With a 5% reserve requirement, how much can the bank loan o
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Answer #1

Deposits = $5000

Reserve ratio = 5%

So, reserve requirement = (5%)(5000)= 250

So, the bank can loan out = $(5000-250)= $4750. Hence , option(A) is correct.

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