Banks Create Money When They

question 81

Multiple Choice

Banks create money when they:

• A) make loans.
• B) take deposits.
• C) hold excess reserves.
• D) pay withdrawals to depositors.

Recognize the advantages and disadvantages of different forms of business ownership.

Identify the roles and responsibilities within the corporate organizational structure.

Comprehend the concept and implications of corporate governance.

Understand the taxation of corporations and double taxation.

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Definitions:

Third-Party Beneficiary

A recipient of contractual benefits who is not one of the contracting parties; created when two parties enter into a contract with the intended purpose of benefiting a third party.

Creditor Beneficiary

A third party that benefits from a contract made between two other parties, especially in terms of having the right to claim performance or compensation.

Donee Beneficiary

An external party that gains advantages from an agreement established between two different parties.

Delegation

The process of assigning authority and responsibilities to others to carry out specific activities or tasks.