Which of the following does not directly influence the amount of required reserves a bank must hold?
A) The required reserve ratio.
B) The dollar amount of cash items in process of collection.
C) The dollar amount of demand deposits outstanding.
D) The dollar amount of money market deposit accounts outstanding.
E) The dollar amount of NOW accounts outstanding.

Question

Quizplus · Accepted Answer

Money market deposit accounts and NOW accounts are both types of demand deposits, so they directly influence the required reserves amount. Cash items in process of collection and demand deposits outstanding are both components of a bank's deposit liabilities, which in turn affect the required reserves. The required reserve ratio is the percentage set by the Federal Reserve, so it also directly influences the required reserves amount.

Which of the Following Does Not Directly Influence the Amount