The requirement on banks to hold only a portion of their deposits as reserves is known as

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The requirement on banks to hold only a portion of their deposits as reserves is a characteristic of the fractional reserve banking system. The federal reserve system is the central banking system of the United States, the federal open market system is the system by which the Federal Reserve conducts monetary policy, and the federal deposit insurance system is a government program that provides insurance on deposits in case a bank fails.

The Requirement on Banks to Hold Only a Portion of Their