Banks prefer __________ hold excess reserves because __________.
A) not to; excess reserves earn no interest
B) not to; banks are not required to hold them
C) to; excess reserves earn interest
D) to; banks need them to prevent runs
Correct Answer:
Verified
Q10: If the required reserve ratio is .25,
Q11: A bank creates money
A) never since it
Q12: Which of the following is classified as
Q13: Which of the following is classified as
Q14: The Federal Reserve's ability to control the
Q16: Assume that the required reserve ratio is
Q17: A bank's excess reserves can be calculated
Q18: When a bank pays a check drawn
Q19: The largest component of the money supply
Q20: Assume that excess reserves are $10 million,
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