In a Fractional-Reserve Banking System,a Bank

question 55

Multiple Choice

In a fractional-reserve banking system,a bank

• A)does not make loans.
• B)does not accept deposits.
• C)keeps only a fraction of its deposits in reserve.
• D)None of the above is correct.

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Definitions:

Traceable Fixed Expense

Fixed costs that can be directly linked to a specific business segment or product line.

Net Operating Income

The profit a company makes from its operations, exclusive of taxes and other non-operational expenses.

Price Hike

An increase in the selling price of goods or services, often due to increased production costs or higher demand.

Traceable Fixed Expense

A fixed cost that can be directly linked to a specific business segment, product, or operation without any ambiguity.