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Historically,why Were Goldsmiths Able to Create Money

Question 117

Multiple Choice

Historically,why were goldsmiths able to create money?


A) Because consumers and merchants preferred to use gold rather than currency for transactions.
B) Because they always kept 100 percent reserves.
C) Because only a few of their customers would redeem their notes for gold at any one time.
D) Because they held the right to print money.

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