Fractional reserve banking is a term used to describe a banking system whereby
A) individual banks share a fraction of the total funds deposited in the whole banking system.
B) banks are required to quote interest rates in fractions.
C) banks hold reserves equal to only a fraction of their deposit liabilities.
D) banks hold reserves equal to a multiple of their deposit liabilities; that is, fractional in this case really means multiple.
E) banks are required to maintain a certain fraction of their deposits in the form of checkable deposits, a certain fraction of their deposits in the form of savings deposits, etc.
C
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Another term for equilibrium price is
a. dynamic price. b. market-clearing price. c. quantity-defining price. d. balance price.
A decrease in the interest rate could have been caused by the money-demand curve shifting
a) leftward because the price level fall. b) leftward because the price level rose. c) rightward because the price level fell. d) rightward because the price level rose.
Which of the following is not a coincident indicator?
A. personal income B. industrial production C. manufacturing and trade sales D. average workweek
When many substitutes exist for a good, demand will be
A) elastic. B) unit-elastic. C) inelastic. D) perfectly unit-elastic.