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Every loan creates a ______. - Economics

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Question

Every loan creates a ______.

Options

  • loss

  • profit

  • deposit

  • credit

MCQ
Fill in the Blanks
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Solution

Every loan creates a deposit.

Explanation:

If all the transactions in an economy are routed through commercial banks, then the money spent by the borrower would come back to the bank in the form of deposits.

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2013-2014 (October)
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