Commercial banks are able to create money by
A) exchanging their reserves at the Fed for vault cash.
B) making loans.
C) making customers pay back their loans.
D) printing Federal Reserve Notes.
Correct Answer:
Verified
Q262: A small commercial bank has $10,000 in
Q263: The banking system in the United States
Q264: Suppose a bank has $1,500,000 in deposits
Q265: If the desired reserve ratio is 3
Q266: A bank with $100 million in deposits
Q268: If Bank A holds $200 in reserves,
Q269: Excess reserves are
A) liquidity funds minus actual
Q270: When bank deposits increase from $1 million
Q271: The difference between actual reserves and required
Q272: Excess reserves are equal to
A) actual reserves
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents