Modern bankers
a. expand the money supply by printing currency when they need it.
b. decrease the supply of money when they extend additional loans.
c. hold only a fraction of their assets in the form of reserves against their deposits.
d. can increase their profits by increasing their holdings of excess reserves.
C
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Sam is a musician who is out of work because electronic equipment replaced live musicians. This is an example of:
a. frictional unemployment. b. cyclical unemployment. c. structural unemployment. d. involuntary unemployment.
The concept of free trade is based on the principle that countries should specialize in the production of goods for which the
a. absolute advantage is highest b. absolute advantage is lowest c. opportunity cost is highest d. opportunity cost is lowest e. consumers have the highest demand