Primary deposits are deposits that add new reserves to a bank while obtuse secondary deposits are deposits that were borrowed from the reserves of primary deposits.

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Primary deposits refer to deposits made directly into a bank, adding to their reserves, while secondary deposits are created through the lending and borrowing of the primary deposits. Therefore, secondary deposits are not obtained by borrowing from the reserves of primary deposits, but rather from the lending activities of the bank.

Primary Deposits Are Deposits That Add New Reserves to a Bank