In a fraction reserve banking system , a bank keeps only a fraction of its deposits in reserve. Thus, the correct answer is C.
A banking system is a collection or network of organizations that offers us financial services. These organizations are in charge of running the financial system, making loans, accepting deposits, and assisting with investments.
In a banking system, fractional reserve banking, banks only keep a portion of the money that clients deposit with them in reserves. As a result, they can effectively crate new money by using the remaining funds to make loans.
Benefits of fractional-reserve banking include the possibility for banks to earn more money for their reserves and a more availability of credit.
Therefore, option C keeps only a fraction of deposits in reserve is appropriate answer.
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