Banks whose current reserves are higher than the reserve requirement:
A)demand overnight loans.
B)supply overnight loans.
C)supply bonds in the bond market.
D)do not have excess reserves.

Question

Quizplus · Accepted Answer

Banks with current reserves higher than the reserve requirement can supply overnight loans to other banks that require additional reserves. This can help to earn interest on the excess reserves while helping other banks meet their reserve requirements.

Banks Whose Current Reserves Are Higher Than the Reserve Requirement