Question

if the reserve rate is 3% and a bank receives a deposit of 16,000 how much of the 16,000 is the bank free to loan out?

Answer 1

Answer: $15,520

Explanation:

Just took the test :)

Answer 2

that means the bank keeps 3% and can loan out 97% of the total

16000*0.97 = $15,520 can be loaned out