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The existence of banks: makes the money supply equal to the amount of currency in circulation. results in the money supply being larger than the amount of currency in circulation. inhibits the creation
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14 votes
14 votes
The existence of banks: makes the money supply equal to the amount of currency in circulation. results in the money supply being larger than the amount of currency in circulation. inhibits the creation of money. results in the money supply being less than the amount of currency in circulation.

User Masam
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1 Answer

15 votes
15 votes

Answer:

results in the money supply being larger than the amount of currency in circulation.

Step-by-step explanation:

The banks existence could be resulted in more money supply as compared to the currency amount i.e. monetary base and also the currency amount could be in the circulation base

So as per the given situation, the above should be the answer

And, the rest of the options seems incorrect

User Rmtheis
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