There are two basic sources of loanable funds: current savings and the expansion of deposits of depository institutions.

Question

Quizplus · Accepted Answer

This statement is true. Current savings and the expansion of deposits of depository institutions are the two main sources of loanable funds. Current savings come from individuals and businesses who are saving money, while the expansion of deposits refers to depository institutions such as commercial banks creating new money through lending and investing activities.

There Are Two Basic Sources of Loanable Funds: Current Savings