3 years ago

How does the fractional reserve system increase the money supply in a country?

History

2 answers:

Troyanec [42]3 years ago

8 0

Answer:

By using deposited money to make loans without reducing the value of the deposits

Explanation:

A P Ex

Your welcome

icang [17]3 years ago

4 0

Answer: Fractional reserve banking increases the money supply by lending out the money multiple times over -- so doesn't this by nature result in debt (that cannot be paid back) and/or inflation.

Explanation:

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