The Type of Banking System Under Which Banks Are Required

question 37

Multiple Choice

The type of banking system under which banks are required to hold only a portion of their assets in reserve against the checking deposits of their customers is called

• A) a gold-backed banking system.
• B) a full reserve banking system.
• C) a fiat banking system.
• D) a fractional reserve banking system.

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Definitions:

Unemployed

Refers to individuals who are capable of working and willing to work but cannot find employment.

Misery Index

An economic indicator created by summing the unemployment rate and inflation rate, intending to measure economic discomfort within a country.

Financial Industry

A sector of the economy that includes businesses and institutions that provide financial services, such as banking, investment, and insurance.

Stimulus

Economic measures taken by the government to encourage growth or prevent economic slowdown, often through spending or tax cuts.