Banks Create Money When They

question 32

Multiple Choice

Banks create money when they

• A) allow loans to mature.
• B) accept deposits of cash.
• C) buy government bonds from households.
• D) sell government bonds to households.

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Definitions:

Excise Tax

A targeted tax levied on the sale of specific goods and services, such as alcohol and tobacco, often used to discourage consumption.

Equilibrium Output

The level of production in a market where the quantity supplied equals the quantity demanded, leading to a state of balance without excess supply or demand.

Migraine Headaches

A type of headache characterized by severe pain, often accompanied by nausea, vomiting, and sensitivity to light and sound.

Recurrent Attacks

Episodes that occur repeatedly over time, often referring to medical conditions such as seizures or migraines.