The Maximum Demand Deposit Creation Possible from a New Deposit

question 81

True/False

The maximum demand deposit creation possible from a new deposit is derived from the equation D = E x 1/r.

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Definitions:

Intended Third-party

Someone who, although not a direct participant in a contract or agreement, stands to benefit from the execution of the agreement.

Incidental Third-party

A person or entity indirectly involved or unintentionally benefited by a transaction or contract between two other parties.

Beneficiary

An individual or entity designated to receive benefits or assets from an insurance policy, will, or trust.

Third Party

An individual or entity separate from the two parties directly involved in a contract, agreement, or dispute.