The required reserve ratio is the percentage of ______ that a bank must keep as vault cash or deposits at the Federal Reserve.
A) checking deposits
B) savings deposits
C) government securities
D) corporate stock

Question

Quizplus · Accepted Answer

The required reserve ratio refers to the fraction of deposits, specifically checking deposits, that banks are mandated to keep on hand as vault cash or with the central bank (such as the Federal Reserve in the United States) to ensure liquidity and stability in the banking system. Savings deposits, government securities, and corporate stock are not directly related to this requirement.

The Required Reserve Ratio Is the Percentage of ______ That