Fractional Reserve Banking Refers to a Banking System in Which

question 28

Multiple Choice

Fractional reserve banking refers to a banking system in which

• A) bank deposits are less than bank reserves.
• B) bank reserves are only a fraction of total deposits.
• C) bank reserves are only a fraction of required reserves.
• D) bank loans are less than bank reserves.

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Definitions:

Volume

The amount of space an object, such as a drug, occupies.

Drug

A substance used to diagnose, treat, cure, or prevent diseases in humans or animals, often regulated by health authorities.

Metric Equivalent

The corresponding value of a unit of measure expressed in the International System of Units (SI).

Liter

A metric unit of volume equivalent to 1,000 cubic centimeters or about 0.26 gallons.