The percentage of deposits that must be held as reserves is called

Question

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The required reserve ratio is the percentage of deposits that banks are required to hold as reserves by the central bank. This ratio differs from country to country and is a tool used by the central bank to control the money supply. Option A (excess reserves) refers to reserves held by banks in excess of the required reserves, while option B (required reserves) refers to the total amount of reserves that banks are required to hold. Option D is incorrect as one of the options must be correct.

The Percentage of Deposits That Must Be Held as Reserves