Banks Create Money by

question 356

Multiple Choice

Banks create money by

• A)printing dollar bills without limit.
• B)creating deposits without limit.
• C)printing money up to their required reserve limit.
• D)making loans and creating deposits,a process that is limited by the size of banks' excess reserves.
• E)buying U.S.government securities with cash.

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Definitions:

Futures Option

A financial derivative that gives the holder the right, but not the obligation, to buy or sell a futures contract at a specified price on or before a certain date.