Banks create money in the economy by:
A) loaning out part of each deposit, which will be redeposited by someone else.
B) charging higher interest on loans than savings.
C) charging higher interest on savings than loans.
D) loaning out all of their deposits to borrowers.
Correct Answer:
Verified
Q30: A larger money multiplier means:
A) the reserve
Q31: The money multiplier is approximated as being
Q32: Which of the following would not make
Q33: In the United States, the dollar was
Q34: Funds held in bank accounts that can
Q36: Under fractional reserve banking:
A) banks only need
Q37: What is a major danger of fiat
Q38: Banks earn money:
A) by lending funds and
Q39: Modern banks in the United States keep
Q40: Fiat money is:
A) any form of money
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