Any Bank That Uses Deposits to Make Loans

question 132

Multiple Choice

Any bank that uses deposits to make loans:

• A)operates on a 100 percent reserve system.
• B)operates on a fractional reserve system.
• C)does not operate on a reserve system.
• D)does not keep reserves in its vaults.
• E)charges an interest rate determined by the reserve ratio.

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Definitions:

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