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The capacity of banks to grant loans depends, in the long run, on the amount of money deposited with them by the public. In the short run, however, it is a well-known fact that banks not only can, but do, lend more than is deposited with them. If such lending is carried to excess, it leads to inflation.The passage best supports the statement that

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The capacity of banks to grant loans depends, in the long run, on the amount of money deposited with them by the public. In the short run, however, it is a well-known fact that banks not only can, but do, lend more than is deposited with them. If such lending is carried to excess, it leads to inflation.<br>The passage best supports the statement that






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