Which of the Following Is False

question 16

Multiple Choice

Which of the following is false?

• A) Under free banking,banks would not be subject to any special regulations beyond those which are required of other businesses.
• B) Under free banking,banks would be allowed to issue their own currency.
• C) The government would largely control the actions of banks under free banking.
• D) The market forces would raise or lower the money supply under free banking.

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Definitions:

Quantitative Easing

A monetary policy used by central banks to increase the money supply by buying government securities or other securities from the market.

Central Bank

A national bank that provides financial and banking services for its country's government and commercial banking system and implements monetary policy.

Economic Growth

An increase in the production of goods and services in an economy over time, typically measured as the percentage increase in real GDP.

Inflation

The pace at which the overall price level for goods and services increases, diminishing the buying power.