Outcome: Lending and Money Creation

What you’ll learn to do: understand how money is created by lending

In this section, you will see how banks can actually create money through loans.

The specific things you’ll learn in this section include:

  • Calculate the lending capacity of a bank given its deposits and a required reserve ratio


The learning activities for this section include:

  • Reading: How Banks Create Money
  • Reading: Money Creation
  • Video: Creating Money
  • Self Check: Lending, Money, and Banks

Take time to review and reflect on each of these activities in order to improve your performance on the assessment for this section.