Which of the Following Chains of Logic Explain the Functions

question 17

Multiple Choice

Which of the following chains of logic explain the functions of banks in the process of economic growth?

• A) Savers deposit their savings in banks. Banks direct these funds to firms that invest and engage in capital accumulation that furthers economic growth.
• B) Savers deposit their savings in banks. Banks engage in capital accumulation, which plays an important role in economic growth.
• C) Firms borrow from stock and bond markets. These funds are used for investment, which leads to the capital accumulation that furthers economic growth.
• D) The demand for loanable funds shows an inverse relationship between the real interest rate that banks charge and the quantity of loans demanded.