Reserves held at the Fed are:
A) kept in a secure vault in Washington,DC.
B) electronic claims that can be converted into currency if the bank wishes.
C) mostly held by banks in Panama,Ecuador,and El Salvador.
D) kept exclusively in the form of gold bars.

Question

Quizplus · Accepted Answer

Reserves held at the Fed are in the form of electronic claims, which can be converted into physical currency if the bank wishes. The other options are incorrect, as reserves are not held in a secure vault in Washington, DC or exclusively in the form of gold bars, and there is no evidence to suggest that they are mostly held by banks in Panama, Ecuador, and El Salvador.

Reserves Held at the Fed Are