1-23 The liabilities of depository institutions are significant components of the money supply.

Question

Quizplus · Accepted Answer

Depository institutions such as banks, credit unions, and savings and loan associations issue liabilities such as deposits to their customers. These deposits are part of the money supply as they can be withdrawn and used as a medium of exchange. Therefore, the liabilities of depository institutions are indeed significant components of the money supply.

1-23 the Liabilities of Depository Institutions Are Significant Components of the Money