14) Deposits are examples of a bank's 14) A) assets. B) balance sheet. C ) net worth. D) liabilities

. 15) Which of the following is a bank liability? 15) A) loans made to customers B) required reserves C ) reserve deposits held at the Fed D) demand deposit balances

16) Which one of the following statements is true? 16) A) A bank's reserves can only be kept as cash in its vault. B) Assets generate income for a bank. C ) A bank's assets plus its liabilities equals must equal zero. D) Demand deposits are assets of a bank. 17) By law, banks are required to

17) A) hold a fraction of their reserves at the Federal Reserve bank. B) hold a fraction of demand deposits as reserves. C ) lend out no more than the amount of their required reserves. D) hold 100 percent of customer deposits as reserves. 2

18) Logan finds $10 in his jacket pocket and deposits it into a bank. As a result of this single
transaction, M1 has 18) A) increased by $10. B) not changed. C ) increased by less than $10. D) increased by more than $10.