The money expansion process continues until there are no more _____

Question

Quizplus · Accepted Answer

The money expansion process involves banks lending out their excess reserves, which are the reserves they hold above and beyond the required reserves. As they continue to lend out these excess reserves, the money supply expands. However, this process stops when there are no more excess reserves in the banking system that banks are willing to lend. Once all the excess reserves have been lent out, the process comes to an end and the money supply stops expanding.

The Money Expansion Process Continues Until There Are No More