Retail sweep accounts
A)involve the relabeling of deposit liabilities to nondeposit liabilities.
B)"sweep" balances out of transactions accounts that are subject to reserve requirements and into other accounts that are not.
C)cause required reserves to fall by the amount of funds swept into sweep accounts multiplied by the required reserve ratio.
D)All of the above are correct

Question

Quizplus · Accepted Answer

Retail sweep accounts involve moving funds from accounts that have reserve requirements to those that do not, effectively reducing the amount of reserves a bank is required to hold. This process includes relabeling liabilities and impacts the calculation of required reserves.

Retail Sweep Accounts