Table 16-2 -Refer to Table 16-2

Table 16-2
$\begin{array}{|c|c|}\hline \text { Assets } & \text { Liabilities } \\\hline \text { Reserves }+\$ 8,000 & \text { Deposits }+\$ 8,000 \\\hline\end{array}$
-Refer to Table 16-2.Suppose a transaction changes a bank's balance sheet as indicated in the following T-account,and the required reserve ratio is 10 percent.As a result of the transaction,the bank can make a maximum loan of

A) $0.
B) $800.
C) $7,200.
D) $8,000.

Correct Answer:

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