Which one of the following functions that goldsmiths performed was most important in the development of modern-day fractional reserve banking? Goldsmiths stored gold for people in their vaults. Goldsmiths issued paper receipts to people who stored gold in the goldsmiths’ vaults. By issuing additional paper receipts, goldsmiths made loans to people who did not necessarily have gold deposits. The paper receipts issued by the goldsmiths were accepted by merchants as a means of payment.
Which one of the following functions that goldsmiths performed was most important in the development of modern-day fractional reserve banking? Goldsmiths stored gold for people in their vaults. Goldsmiths issued paper receipts to people who stored gold in the goldsmiths’ vaults. By issuing additional paper receipts, goldsmiths made loans to people who did not necessarily have gold deposits. The paper receipts issued by the goldsmiths were accepted by merchants as a means of payment.
Foundations of Business (MindTap Course List)
6th Edition
ISBN:9781337386920
Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Publisher:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Chapter16: Mastering Financial Management
Section16.7C: Cost Comparisons
Problem 3CC
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Which one of the following functions that goldsmiths performed was most important in the development of modern-day fractional reserve banking?
Goldsmiths stored gold for people in their vaults.
Goldsmiths issued paper receipts to people who stored gold in the goldsmiths’ vaults.
By issuing additional paper receipts, goldsmiths made loans to people who did not necessarily have gold deposits.
The paper receipts issued by the goldsmiths were accepted by merchants as a means of payment.
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