Question

A small local bank has made many loans to several energy companies recently because these companies have had no problem repaying their loans in the past. If energy prices suddenly drop and the companies cannot pay their loans, what is the most likely effect on the local money supply?

Answer 1

The bank would not be greatly affected, and the money supply would not change.

The bank would have a minor increase in business, and the money supply would increase.

The bank would immediately make more loans, and the money supply would increase.

The bank would be negatively affected, and the money supply would decrease.

Answer 2

@That_Other_Girl

Answer 3

Well first off, which one do you think would be the best answer?

Answer 4

idk :(

Answer 5

you know i can't just give you the answer, but i will help out eliminate which ones are wrong. :)

Answer 6

ok well i mena if i really had to choose i would think that it is d

Answer 7

i would also go along with that answer.
Seeing that since the energy companies cannot pay back their loans, that means that the bank and the local money supply would end up losing money.

Answer 8

can u help me check a couple more ?

Answer 9

Of course. :)

Answer 10

:D

Answer 11

in another question ?

Answer 12

Sure. :)