Use the following example to answer the following questions: Imagine that Stella deposits $25,000 in currency (which she had been storing in her closet) into her checking account at the bank. Assume that this institution has a required reserve ratio of 25 percent.
As a result of this deposit, what is the maximum amount the bank can hold as loans?
a. $O
b. $18,750
c. $25,000
d. $31,250
e. $100,000
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