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Banks create money when they make loans.

leticia1977

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Banks create money when they make loans.

Banks create money when they make loans.
a. True
b. False
Indicate whether the statement is true or false

QUESTION 2

If the required reserve ratio is 4 percent, then 100 of reserves can support up to 2,500 of checkable deposits.
a. True
b. False
Indicate whether the statement is true or false

QUESTION 3

A bank can lend out its excess reserves but not its required reserves.
a. True
b. False
Indicate whether the statement is true or false

QUESTION 4

The amount of checkable deposits in an economy cannot exceed the amount of currency that the government has issued.
a. True
b. False
Indicate whether the statement is true or false

QUESTION 5

In a simplified system, a bank receiving a new deposit can extend new loans equal to the amount by which its excess reserves increase.
a. True
b. False
Indicate whether the statement is true or false

QUESTION 6

Reserves of banks appear on their balance sheet as liabilities.
a. True
b. False
Indicate whether the statement is true or false

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gimblox

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leticia1977 Author

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7 years ago

Nice!

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gimblox

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