The Fractional Reserve Characteristic of the Banking System Allows Banks

question 20

Essay

The fractional reserve characteristic of the banking system allows banks to create money and also create wealth from bank deposits. Describe why this statement is or is not true.

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Definitions:

CIO

Congress of Industrial Organizations, a federation of unions that organized workers in industrial unions in the United States and Canada from 1935 until its merger with the AFL in 1955, becoming AFL-CIO.

AFL

The American Federation of Labor, a national federation of labor unions in the United States founded in 1886.

Tuskegee Study

A notorious and unethical study conducted between 1932 and 1972 by the U.S. Public Health Service studying the natural progression of untreated syphilis in African American men.

Syphilis

A sexually transmitted infection caused by the bacterium Treponema pallidum, characterized by various stages including sores, rash, and severe long-term symptoms if untreated.