Responses
A bank loans a percentage of every depositor's funds to borrowers.
A bank loans a percentage of every depositor's funds to borrowers.
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.
1 answer
The correct response that describes the practice of fractional-reserve banking is:
"A bank loans a percentage of every depositor's funds to borrowers."
In fractional-reserve banking, banks are required to keep only a fraction of their deposits in reserve and can loan out the remainder, thereby creating money through the lending process.
1 answer
1 answer
7 answers
1 answer