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How does the bank work?

Updated: 1/15/2023
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13y ago

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An example on how a bank uses its money

Example: $100/100%/deposit

When a deposit is made, 10% is held in reserve. The other 90% is loaned out. A bank can loan some money to another bank or loan it to someone who promises to pay it back. Through the loan, it recirculates and gets reused in the economy.

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13y ago
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Q: How does the bank work?
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