What impacts did the decentralization of the U.S. banking system during the Free Banking Era have on the currency in the United States? Select the two correct answers.(1 point)

Question

Responses

The purchasing power currencies issued by state banks varied wildly from state to state.
The purchasing power currencies issued by state banks varied wildly from state to state.

Monetary reserves decreased.
Monetary reserves decreased.

The money supply declined.
The money supply declined.

Land was frequently purchased with counterfeit currency.
Land was frequently purchased with counterfeit currency.

The amount of loanable funds increased.

Answer 1

The two correct answers regarding the impacts of the decentralization of the U.S. banking system during the Free Banking Era on currency in the United States are:

1. The purchasing power currencies issued by state banks varied wildly from state to state.
2. Land was frequently purchased with counterfeit currency.

These reflect the instability and unpredictability associated with a system where many banks issued their own currency without a centralized regulatory body.