Which of the following statements is correct about creating money?
a. Insurance companies can literally create money through the process of making loans.
b. The banking system can literally create money through the process of making loans.
c. The banking system cannot literally create money through the process of making loans.
d. Insurance companies cannot literally create money through the process of making loans.
b. The banking system can literally create money through the process of making loans.
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Suppose the government increases its expenditures by $100 billion and simultaneously reduces the money supply by $100 billion. We definitely know that
A) equilibrium GDP will fall. B) equilibrium GDP will rise. C) the interest rate will rise. D) the interest rate will fall.
Coke and Pepsi probably have a:
A. less elastic cross-price elasticity of demand than do Coke and bananas. B. cross-price elasticity of demand that is smaller than do Coke and bananas. C. negative cross-price elasticity of demand. D. more elastic cross-price elasticity of demand than do Coke and bananas.