The primary purpose of the legal reserve requirement is to
A) prevent banks from hoarding too much vault cash.
B) provide a means by which the monetary authorities can influence the lending ability of commercial banks.
C) prevent commercial banks from earning excess profits.
D) provide a dependable source of interest income for commercial banks.Topic: Money-Creating Transactions of a Commercial Bank
Correct Answer:
Verified
Q2: Which of the following statements is correct?
A)
Q8: Suppose a commercial bank has checkable deposits
Q9: Q9: A bank that has liabilities of $150 Q13: Which one of the following is presently Q15: Most modern banking systems are based on Q16: The reserves of a commercial bank consist Q18: The ABC Commercial Bank has $5,000 in Q19: Bank panics Q27: When a check is drawn and cleared,
A)
A) occur frequently in fractional reserve
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