Asked by
raabe carvalo
on Dec 16, 2024Verified
In order to meet a deficiency of required reserves,a bank could:
A) buy securities.
B) deposit vault cash with the Fed.
C) turn some of its deposits at the Fed into cash.
D) close some checking accounts.
E) borrow from another bank in the federal funds market.
Federal Funds Market
A market for overnight lending and borrowing of reserves among banks; the interbank market for reserves on account at the Fed.
Required Reserves
The minimum amount of funds that a bank must hold in reserve against deposits, as mandated by regulatory bodies.
- Perceive the role and consequences of the Federal Reserve's policies on banking reserves and the expansive financial market.
Verified Answer
CS
Learning Objectives
- Perceive the role and consequences of the Federal Reserve's policies on banking reserves and the expansive financial market.