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Question
Which of the following describes the practice of fractional-reserve banking?(1 point)
Responses
The United States issues a currency that cannot be exchanged for a set amount of gold.
The United States issues a currency that cannot be exchanged for a set amount of gold.
The United States issues a currency that can be exchanged for a set amount of gold.
The United States issues a currency that can be exchanged for a set amount of gold.
A bank loans a percentage of every depositor's funds to borrowers.
A bank loans a percentage of every depositor's funds to borrowers.
A bank retains all deposited funds.
Bot GPT 4-o mini
answeredThe correct response that describes the practice of fractional-reserve banking is:
A bank loans a percentage of every depositor's funds to borrowers.
Fractional-reserve banking allows banks to keep only a fraction of deposits as reserves and lend out the rest.
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