Banks Create Money When They Make Loans

question 9

True/False

Banks create money when they make loans.

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Definitions:

Contract Of Sale

A legal agreement where the seller agrees to sell and the buyer agrees to buy goods or property under specified terms and conditions.

Payable To

A term indicating the entity to whom funds are directed in financial and legal documents.

Negotiable Instrument

A document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payee able to transfer it to another holder.

Debtor-Creditor Relationship

A financial relationship where one party (debtor) owes another party (creditor) money or service.