In the Absence of Fractional-Reserve Banking Practices,commercial Banks Would

question 58

Multiple Choice

In the absence of fractional-reserve banking practices,commercial banks would

• A) be less safe as places to keep money.
• B) have more money available to be put to work on behalf of business firms.
• C) charge depositors higher fees for keeping deposits.
• D) be considered as nonprofit organizations.
• E) need to borrow money if a run occurred.

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Definitions:

Market Theory

A set of principles that attempts to explain the functioning and dynamics of the marketplace, including the interactions between buyers, sellers, and prices.

Religion

A structured set of beliefs and practices centered around spiritual, moral, and supernatural elements, often shared by a community or society.

Protestant Ethic

A concept in sociology, introduced by Max Weber, suggesting that the values of hard work, frugality, and diligence in Protestant groups contributed to economic success.

Max Weber

A German sociologist, philosopher, and political economist whose theories on social and economic organization have significantly impacted social sciences.