Question

One important way in which banks make economic growth possible is by

A)
selling savings bonds.
B)
cashing payroll checks.
C)
lending money to business startups.
D)
offering checking and savings accounts.

Answer 1

c). Lending money to business startups.

Step-by-step explanation:

Banks receive deposits from customers, retains a small fraction, and loan out the big proposition to other customers. This way, banks pull together resources for businesses and households to borrow for consumption and expansion. Therefore, banks are intermediaries for the supply and demand for credit.

Banks help in economic development by availing capital for start-ups and growth through loans. They use customers' deposits to create credit facilities for businesses.