Sweep accounts
A)have made reserve requirements nonbinding for many banks.
B)sweep funds out of deposit accounts into long-term securities.
C)enable banks to avoid paying interest to corporate customers.
D)reduce banks' assets.

Question

Quizplus · Accepted Answer

Sweep accounts have made reserve requirements nonbinding for many banks by automatically transferring (sweeping) funds from deposit accounts into accounts that do not require reserves, thus effectively reducing the amount of reserves a bank must hold.

Sweep Accounts