Responses
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.
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.
A bank retains all deposited funds.
A bank retains all deposited funds.
A bank loans a percentage of every depositor's funds to borrowers.
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The correct description of fractional-reserve banking is:
A bank loans a percentage of every depositor's funds to borrowers.
In fractional-reserve banking, banks keep a fraction of deposits as reserves and loan out the rest, which allows them to create credit and expand the money supply.
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