Which of the Following Is a Direct Result of a Fractional

question 146

Multiple Choice

Which of the following is a direct result of a fractional reserve banking system?

• A) The money multiplier is greater than 1.
• B) Excess reserves are equal to zero.
• C) Required reserves are equal to total reserves.
• D) Banks can loan only their required reserves.

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Definitions:

Conjunction

A logical operator that links propositions together in such a way that the resulting statement is true only when both propositions are true.

Disjunction

A logical operation that results in true if at least one of its components is true.

Conditional

A compound proposition containing two component propositions (the antecedent and the consequent) and asserting that the truth of one component would be sufficient for the truth of the other.

Biconditional

A logical statement where both components imply each other; true only when both parts are either true or false.