In a Fractional-Reserve Banking System, Banks Create Money Because

question 97

Multiple Choice

In a fractional-reserve banking system, banks create money because:

• A) each dollar of reserves generates many dollars of demand deposits.
• B) banks have the legal authority to issue new currency.
• C) funds are transferred from households wishing to save to firms wishing to borrow.
• D) the wealth of the economy expands when borrowers undertake new debt obligations.

Recognize the approval requirements for compulsory share exchanges and mergers.

Comprehend the role of the secretary of state in involuntary dissolution due to non-payment of annual franchise taxes.

Differentiate between purchasing a company's stock vs. its assets and the legal implications.

Understand the effect of dissolution on a corporation's existence and obligations.

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Definitions:

Quality Control

The processes and procedures put in place to ensure that products or services meet certain standards and criteria of quality.

Concurrent Quality Control

Quality control applied to work in progress.

Inferential Statistics

A branch of statistics that makes predictions or inferences about a population based on a sample of data.

Statistical Analysis

The collection, examination, interpretation, presentation, and organization of data using statistical methods and techniques.