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The economy would slow dramatically due to a shortage of bank loans.

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8y ago

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What if Banks decide to keep more of their assets as reserves in order to avoid risking a shortage of the required reserve?

It would NOT shrink the money supply, it would just cause the supply of money to grow at a slower pace. So it would decrease the rate of growth of the money supply.


What is the advantage and the dis advantage of free market economy?

A free enterprise economy is also known as capitalism. There are many advantages to capitalism because capitalism benefits everyone. Capitalism gives everyone the freedom to choose their own jobs and products without government intervention. However, a disadvantage is that companies tend to cut corners risking employees health and safety.


Disadvantages of capitalist society?

Economic, social & cultural polarization between property-owners and others; inefficient use of human capital through hereditary transmission of wealth & status; tendency to cycles of over-expansion and contraction; disproportionate political influence of propertied classes & sectional business interests; tendency to monopoly & homogenization without strong checks on elimination of competition; fuelling of consumer desire through marketing, risking exclusion & alienation of those of lesser means.


What are the disadvantages for a country and its people when participating in production of The Body Shop?

Participating in the production of The Body Shop can have several disadvantages for a country and its people. Firstly, reliance on the brand may lead to economic dependency, limiting the development of local industries. Additionally, there can be environmental concerns associated with sourcing natural ingredients, potentially harming local ecosystems. Lastly, labor practices may not always align with fair trade principles, risking exploitation of workers and undermining local labor rights.


Generate explanations Why did forming corporations allow big business to increase in power and profitability?

Forming corporations allowed big businesses to increase in power and profitability by enabling them to raise large amounts of capital through the sale of shares, which facilitated expansion and investment in new technologies. Corporations also limited personal liability for investors, encouraging more people to invest without risking their personal assets. This structure allowed for economies of scale, reducing costs and increasing efficiency. Additionally, corporations could attract skilled management and create a more organized approach to operations, further enhancing their competitive advantage.