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Commercial banks can create credit because:
Suggested Answer: D
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9 comments · newest first
KI
Kimbery
12 months ago
I thought it was more about capital requirements, though.
CR
Crista
1 year ago
Central banks do act as lenders of last resort, that's a key point!
AN
Antonio
1 year ago
Wait, are we sure about that? Seems a bit off.
TI
Tina
1 year ago
Totally agree, it's all about how much cash people want at once!
KR
Kristin
1 year ago
Banks can create credit because of customer deposit behavior.
HA
Hassie
1 year ago
Okay, let me think this through. I think the key is to get the profile set up properly as a business account first, so I'm going to go with switching to a business profile.
AR
Aretha
1 year ago
I'm a bit confused on the difference between the public and private keys here. Do we need both or just one of them? I'll have to review my notes to make sure I understand this properly.
CA
Cassi
1 year ago
I remember discussing how finance leases can keep liabilities off the balance sheet, which could help with gearing ratios. Is that what they mean by "off-balance sheet"?
AL
Aleta
1 year ago
This one seems pretty straightforward. The production manager's salary would be an indirect labor cost, so I'm going with option C.