Prior to October 2008,commercial banks tended to hold relatively small amounts of excess reserves because

Name: Prior to October 2008,commercial banks tended to hold relatively small amounts of excess reserves because
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Commercial banks tended to hold relatively small amounts of excess reserves prior to October 2008 because the Fed did not pay interest on reserves. This means that holding excess reserves was not profitable for commercial banks as they did not earn any interest on these reserves.

Prior to October 2008,commercial Banks Tended to Hold Relatively Small