Which of the Following Best Describes How Banks Create Money

question 141

Multiple Choice

Which of the following best describes how banks create money?

• A)Banks charge higher interest rates on loans than they pay on deposits.
• B)Banks charge fees for providing financial advice.
• C)Banks create chequing account deposits when making loans from excess reserves.
• D)Banks make loans from reserves.
• E)Banks bid for the right to print their own currency under the Bank Act.

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