The job of the Fed in limiting the supply of money may be made more complex if commercial banks initially have substantial excess
reserves.

Name: The job of the Fed in limiting the supply of money may be made more complex if commercial banks initially have substantial excess reserves.
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Question

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If commercial banks have substantial excess reserves, they may feel less pressure to borrow from the Fed or reduce their lending, which can make it more difficult for the Fed to limit the supply of money.

The Job of the Fed in Limiting the Supply of Money