The sum of currency and bank deposits at the central bank is called:
A)the money supply.
B)domestic assets.
C)the monetary base.
D)fractional reserves.

Question

Quizplus · Accepted Answer

The monetary base, also known as high-powered money, is the sum of currency and bank deposits at the central bank. It is the foundation of the money supply in an economy, as commercial banks use it to create money through fractional reserve banking. Therefore, option C, the monetary base, is the correct answer.

The Sum of Currency and Bank Deposits at the Central