why is 1/3 of new money kept as currency and 2/3 as deposits?

Banks in New Transylvania have a desired reserve ratio of 10 percent of deposits and no excess reserves. The currency drain ratio is 50 percent of deposits. Now suppose that the central bank increases the monetary base by $1,200 How much do the banks lend in the first round of the money creation process? How much of the initial amount loaned flows back to the banking system as new deposits? How much of the initial amount loaned does not return to the banks but is held as currency? Why does a second round of lending occur? Banks lend S 1200 in the first round of the money creation process. A second round of lending occurs because the banks Of the initial amount lent, $ 800 flows back to the banking system as new deposits. O A. are lending institutions that are mandated under their charters to loan money, which increases economic growth The amount held as currency is $ 400 B. have $720 of excess reserves O C. have $400 of excess reserves OD. have $800 of excess reserves