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Eugenie382
Eugenie382 Eugenie382
  • 07-06-2015
  • Business
Answered

Banks do not earn interest on the funds they hold as reserves. How does this provide an incentive to banks to create money by making loans rather than to deposit excess funds in a Fed bank?

Verified Answer :

CielWright
CielWright CielWright
  • 07-06-2015

Banks earn interest when people pay back loans.

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