As of 2006, what was the reserve requirement for checkable deposits?
A)All checkable deposits are subject to a 10% reserve requirement.
B)Checkable deposits at banks are subject to a 10% reserve requirement, while checkable deposits at S&Ls are not subject to a reserve requirement.
C)The first $8.5 million is subject to 0%, then 3% up to $45.8 million in checkable deposits are subject to a 3% reserve requirement and checkable deposits above $45.8 million are subject to a 10% reserve requirement.
D)Reserve requirements on checkable deposits vary according to the location and size of the depository institution.

Question

Quizplus · Accepted Answer

As of 2006, the Federal Reserve set reserve requirements on checkable deposits at a tiered structure. The first $8.5 million in checkable deposits were subject to 0% reserve requirement, while the next $37.3 million were subject to a 3% reserve requirement. Any checkable deposits above $45.8 million were subject to a 10% reserve requirement. This tiered structure helped to ensure that smaller depository institutions were able to operate with lower reserve requirements, while larger institutions had more stringent requirements to ensure stability in the banking system.

As of 2006, What Was the Reserve Requirement for Checkable