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Westkost [7]
3 years ago
5

Explain how banks can create money.

Business
1 answer:
andrey2020 [161]3 years ago
6 0

Answer:

Banks usually operate in a fractional reserve banking system which means that they only have to keep a fraction of all their deposits and can loan out the rest, so they can create money by lending out money. For example if $10 is deposited into a bank and the required reserve ratio is 10% they can loan out $9 and have to keep only $1 in reserve. When they loan out $9 they are creating new money as someone who didn't have any money now has $9. And this keeps on going on as the $9 might also end up in the bank and 90% of that will be loaned out.

Explanation:

Banks usually operate in a fractional reserve banking system which means that they only have to keep a fraction of all their deposits and can loan out the rest, so they can create money by lending out money. For example if $10 is deposited into a bank and the required reserve ratio is 10% they can loan out $9 and have to keep only $1 in reserve. When they loan out $9 they are creating new money as someone who didn't have any money now has $9. And this keeps on going on as the $9 might also end up in the bank and 90% of that will be loaned out.

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Match the types of agreements to their descriptions. Answer choices are will,living will,trust,prenuptial agreement
Roman55 [17]

A will has legal impact after you have passes away and has to be filed with the court.

A living will is similar to a regular will be takes effect while you are still alive to figure out where your assets should be placed.

A trust is an agreement that allows a third party to hold the assets on behalf of a beneficiary.

A prenuptial agreement is an agreement made before a marriage that explains what should happen to their assets in the event their marriage does not last. This is common in famous people due to the amount of money they have.

4 0
4 years ago
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Portman Industries just paid a dividend of $2.40 per share. The company expects the coming year to be very profitable, and its d
Marina86 [1]

Answer:

Dividend for year one;

2.40 × (1+0.12)= 2.688

For year 2

2.40 × (1+0.12)^2 =3.01056

For year 3

2.40 ×(1+0.12)^3 = 3.3718

4 0
3 years ago
One of the keys to gaining self-esteem is to a. Hold yourself to impossible standards b. Focus on the mistakes you make C. Enjoy
Yanka [14]

Answer:

C. Enjoy the small success you achieve

Explanation:

A sure way of boosting self-esteem is to be nice to once self. One should focus on their positive side by appreciating who they are and their success so far. Comparing oneself with others may not achieve the desired results.

Success brings satisfaction and joy to all of us. Focusing on the little success that one has will uplift their spirits and boost self-esteem.

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Which is the most efficient way to make a row of text bold in every worksheet in a file?
kolezko [41]
Select all the sheet tabs, select the row(s) (SHIFT+Click for all, CTRL+Click for seperate) you wish to bolden on the active sheet and enter CTRL+B 
<span>The same row number(s) on each sheet will be made bold. Select a different sheet tab to ungroup the sheets.</span>
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3 years ago
The main difference between sales and excise taxes is that:______.
weqwewe [10]

Answer:

A

Explanation:

A tax is a compulsory amount levied on the goods and services by the government or an agency of the government. Taxes increase the cost of a product

A consumption tax is a tax that is levied on those that consume goods and services rather than produce goods and services

Examples of consumption tax :

  1. excise tax
  2. sales tax

A sales tax is an example of consumption tax. It is levied on the sales of goods and services. It is usually levied at the point of sale. An example is the value added tax.

An excise tax is a tax levied on certain goods and services at the point of sale e.g. tobacco

Differences between excise tax and sales tax

  1. An excise tax applies  to a select list of products while a sales tax applies o a wide range of products
  2. Excise tax is levied on a per unit basis while sales tax is levied as a percentage of purchase price
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