content area top Part 1 How do banks create new deposits by making loans, and what factors limit the amount of deposits and loans they can create? Question content area bottom Part 1 When a bank makes a loan, _______. The amount of loans and new deposits that a bank can create is limited by _______. A. the Fed prints more dollar bills; the speed at which the Fed can increase the quantity of bills in circulation and the desired reserve ratio B. it creates a new deposit for the person who receives the loan; the banks' excess reserves, the desired reserve ratio, and the currency drain ratio C. the Fed creates a new deposit for the bank; the bank's total assets and total liabilities D. the Fed creates a new deposit for the bank; the amount of excess reserves and the desired reserve ratio E. it creates a new deposit for the person who receives the loan; the banks total assets and total liabilities