In a Fractional Reserve Banking System,banks

question 4

Multiple Choice

In a fractional reserve banking system,banks

• A) are able to create money when excess reserves are lent to individuals who need to borrow money.
• B) can lend all of the deposits that are received.
• C) must purchase gold that equals the value of the deposits received.
• D) must deposit all cash from depositors with the Federal Reserve.
• E) have to deposit all cash from depositors in their own bank vault.

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Definitions:

Pilot Study

A small-scale study conducted prior to conducting an actual experiment; designed to test and refine procedures.

Standardize Procedures

Established protocols to ensure consistency and uniformity across experiments or assessments.

Manipulation Check

A measure used to determine whether the manipulation of the independent variable has had its intended effect on a subject.

Double-Blind Procedures

An experimental procedure wherein both the subjects of the experiment and the researchers do not know which subjects are receiving the active treatment versus a placebo, to prevent bias.