The key to understanding the money creation process is the fact that:______.a. since the money supply excludes cash but includes
checking account deposits, money is created whenever individuals deposit cash into a checking account. b. whenever banks create financial liabilities for themselves, they create financial assets for individuals, and those financial assets are considered money. c. whenever banks create financial assets for themselves, they create financial liabilities for individuals, and those financial liabilities are considered money. d. banks are able to print dollar bills and add these to circulation whenever they extend loans.
c. whenever banks create financial assets for themselves, they create financial liabilities for individuals, and those financial liabilities are considered money
c. whenever banks create financial assets for themselves, they create financial liabilities for individuals, and those financial liabilities are considered money
Explanation:
c. whenever banks create financial assets for themselves, they create financial liabilities for individuals, and those financial liabilities are considered money
The best type of account for Jorge, who has $300 for work he performed and expects to spend the money in the next few weeks to buy a new bike is checking account. A checking account is useful for money that you will be spending soon, like in Jorge's case. Checking account can be accessed using checks, automated teller machines and electronic debits.
