Banks will keep excess reserves when
A)they do not foresee profitable opportunities to make loans.
B)business conditions generally are depressed.
C)they do not foresee opportunities to make secure loans.
D)All of these responses are correct.

Question

Quizplus · Accepted Answer

Banks will keep excess reserves when they do not foresee profitable opportunities to make loans or when business conditions are generally depressed. They may also choose to keep excess reserves when they do not see opportunities to make secure loans. Therefore, all of these responses are correct.

Banks Will Keep Excess Reserves When