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  3. 1 fractional reserve banking aa aa consider the following functions...

Question: 1 fractional reserve banking aa aa consider the following functions...

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1. Fractional reserve banking Aa Aa Consider the following functions that goldsmiths used to perform. Of these, which are currently performed by modern-day financial institutions in the context of fractional reserve banking? Check all that apply. The paper receipts issued by the goldsmiths were accepted by merchants as a means of payment. Goldsmiths issued paper receipts to the people who stored their gold in their safes. Goldsmiths made loans to people who did not necessarily have gold deposits by issuing additional paper receipts that would be accepted by merchants as a means of payment. Goldsmiths wanted to avoid a situation in which they had too many paper receipts outstanding, with too many people trying to withdraw gold all at once. Therefore, they kept a certain amount of gold on hand and limited the number of loans they made.

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