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 the above are correct.

Question

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 the above are correct.

Quizplus · Accepted Answer

Banks keep excess reserves when they do not foresee profitable or secure loan opportunities, and when business conditions are depressed, as a precautionary measure to ensure liquidity and manage risk.

Banks Will Keep Excess Reserves When:​

Banks Will Keep Excess Reserves When: