In a fractional-reserve banking system, a bank
a. does not make loans.
b. does not accept deposits.
c. keeps only a fraction of its deposits in reserve.
d. None of the above is correct.
c
You might also like to view...
The ________ of a project is the sum of all costs and benefits associated with the project, using present values to make the costs and benefits comparable
A) discounted value B) cumulative present value C) net present value D) gross present value
Refer to Figure 15-11. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, and the Federal Reserve pursues no policy, then at point B
A) incomes and profits are rising. B) the economy is below full employment. C) the unemployment rate is very, very low. D) there is pressure on wages and prices to rise. E) firms are operating above their normal capacity.