The fraction of chequable deposits that banks choose to hold are ________.

Question

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The fraction of chequable deposits that banks choose to hold is known as desired reserves. This is the amount of reserves that a bank wishes to hold in order to meet withdrawals and payments. Excess reserves refer to any reserves held by a bank above the desired reserves, vault cash is the physical cash held by a bank, and total reserves is the sum of desired reserves and excess reserves.

The Fraction of Chequable Deposits That Banks Choose to Hold