wilsondestiny85
contestada

The practice of fractional reserve banking means that:
O A. banks are required by law to operate as nonprofit organizations.
B. banks are not allowed to use deposited funds to make loans.
C. banks can change the interest rates on loans at any time.
D. banks only keep a portion of their deposits as cash reserves.

Respuesta :

Answer:

ANSWER IS D

Explanation:  Lucky guess

The Practice of Fractional Reserve banking means that the Banks only keep a portion of their deposits as cash reserves. Hence option D is correct.

Fractional Reserve Banking

In order to theoretically expand economy by creating Capital for lending, Banks create Fractional Reserve system. It is a system in which only a fraction of deposits are actually saved as cash on hand and available for withdrawal.

It is based on the notion that each and every depositor will not come for withdrawal in a single day. Hence, the option D which says "banks only keep a portion of their deposits as cash reserves" is Correct.

Learn more about Fractional Reserve Banking here:

https://brainly.com/question/25239575

Otras preguntas