Reserve requirements are the
A) rules covering the types of assets that banks may purchase.
B) minimum percentages of deposits that banks must hold as reserves.
C) minimum amount of an ownerʹs financial resources that must be placed in a depository institution.
D) rules covering the types of deposits that banks may offer.

Question

Quizplus · Accepted Answer

Reserve requirements refer to the minimum percentages of deposits that banks are required to hold as reserves. This is a tool used by central banks to control the amount of money in circulation and influence lending activities of banks. The other choices do not accurately describe reserve requirements.

Reserve Requirements Are the