Fractional reserve banking began as a search for
A)a different metallic monetary system.
B)additional sources of gold.
C)different types of borrowers.
D)additional profits.

Question

Quizplus · Accepted Answer

Fractional reserve banking was developed as a way to increase profits for banks by allowing them to lend out a larger portion of their deposits than they actually held in reserves. This allowed banks to earn interest on loans while still having enough reserves on hand to satisfy depositors who wanted to withdraw their money.

Fractional Reserve Banking Began as a Search for