Legal reserves that a depository institution in the U.S. is required to hold consist of:
A) Amounts on deposit with its District Federal Reserve Branch
B) Coin and currency held in its vault
C) Government securities
D) All of the above
E) Choices A and B only

Question

Quizplus · Accepted Answer

Legal reserves for a depository institution in the U.S. include amounts on deposit with its District Federal Reserve Branch and coin and currency held in its vault. Government securities, while important for liquidity and investment purposes, are not considered part of the required legal reserves.

Legal Reserves That a Depository Institution in the U