If a bank's reserve ratio is increasing,

Name: If a bank's reserve ratio is increasing,
Brand: Quizplus
Rating: 4.8 (46 reviews)

Question

Quizplus · Accepted Answer

The reserve ratio is defined as the fraction of deposits that a bank holds as reserves. If the reserve ratio is increasing, it means that the proportion of reserves to deposits is getting larger. This can happen if the rate of change in reserves is higher than the rate of change in deposits, meaning the bank is increasing its reserves at a faster rate than its deposits are growing.

If a Bank's Reserve Ratio Is Increasing