If the reserve requirement for commercial banking in Nigeria were 30%, a commercial bank which receives an initial cash deposit of N3000 is in a position to...

If the reserve requirement for commercial banking in Nigeria were 30%, a commercial bank which receives an initial cash deposit of N3000 is in a position to lend out?

Answer Details

The reserve requirement is the percentage of deposits that a commercial bank is required to hold in reserve with the Central Bank of Nigeria. In this case, the reserve requirement is 30%, which means that the bank must hold 30% of the N3000 deposit in reserve, or N900. Therefore, the amount of funds that the bank has available to lend out is N3000 - N900 = N2100. So the correct answer is N2,100.