Which one of the following was NOT a cause for the creation of the Eurodollar market?
A)reserve requirements that lower a bank's profits
B)special charges and taxes levied on domestic banking transactions
C)interest rate ceilings on deposits and loans
D)the lack of a requirement to hold a fractional reserve at the Federal Reserve of all deposits

Question

Quizplus · Accepted Answer

The Eurodollar market was created in part due to reserve requirements, special charges, and interest rate ceilings that affected banks' profits and operations domestically. The lack of a requirement to hold a fractional reserve at the Federal Reserve is not a cause for the creation of the Eurodollar market; instead, it's a characteristic of the Eurodollar market itself, which operates outside the jurisdiction of the Federal Reserve and thus is not subject to its reserve requirements.

Which One of the Following Was NOT a Cause for the Creation