The banking system currency

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Suppose that the banking system currency has no excess reserves and that a bank receives a deposit into a checking account of $10,000 in currency. If the required reserve ratio is 0.20, what is the maximum amount that the BANKING SYSTEM can lend out?

A) $10,000 B) $8,000 C) $40,000 D) $50,000

Reference no: EM131392169

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