Banks create money by
A) lending to the Reserve Bank.
B) asking the Reserve Bank to print more currency.
C) making loans.
D) buying government securities.
E) printing currency.

Question

Quizplus · Accepted Answer

Banks create money through the process of making loans. When banks provide loans to individuals or businesses, they are essentially creating new deposits in the borrowers' accounts, thereby increasing the money supply.

Banks Create Money by