Because the Banking System Operates Using Fractional Reserves

question 203

Multiple Choice

Because the banking system operates using fractional reserves,

• A) the money multiplier is greater than one.
• B) excess reserves are equal to zero.
• C) required reserves are equal to 100 percent.
• D) banks can loan out only their required reserves.
• E) the money multiplier must be equal to zero.

---

Definitions:

Pylon

The wide entrance gateway of an Egyptian temple, characterized by its sloping walls.

Androgynous

Exhibiting characteristics or qualities of both male and female.

Akhenaton

An ancient Egyptian pharaoh of the 18th dynasty who is noted for abandoning traditional Egyptian polytheism and introducing worship centered around Aten.

Aton

The sun disk or deity in ancient Egyptian religion, representing a monotheistic form of worship under Pharaoh Akhenaten.