The regulation that sets the minimum fraction of deposits banks must hold in reserve is called the:
A) reserve requirement.
B) money multiplier.
C) interest rate.
D) dual mandate.

Question

Quizplus · Accepted Answer

The regulation that sets the minimum fraction which banks must hold in reserve is called reserve requirement. It is the percentage of a bank's deposits that it must hold in reserve, either in vault cash or on deposit with the central bank.

The Regulation That Sets the Minimum Fraction of Deposits Banks