Question: please do it in 10 minutes will upvote Part (b) 'Loans create deposits' rather than traditional thinking that 'deposits create loans'. Explain what this means

please do it in 10 minutes will upvote Part (b) 'Loans

please do it in 10 minutes will upvote

Part (b) 'Loans create deposits' rather than traditional thinking that 'deposits create loans'. Explain what this means and how does lending increase the money supply? (10 marks] Part (c) Discuss the advantages and disadvantages of a central bank being independent of government. (10 Marks] Part (d) Explain why both the Federal Reserve (USA) and the European Central Bank have both 'instrument independence' and 'goal independence'. [4 marks]

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