Which of the following tools used by the Fed helps protect depositors who may want to withdraw their money without notice?
A) Discount rate
B) Interest rate
C) Open market operation
D) Reserve requirement

Question

Quizplus · Accepted Answer

The reserve requirement is a tool used by the Fed to require depository institutions to keep a certain percentage of their deposits in reserve, meaning they cannot be lent out or invested. This helps protect depositors who may want to withdraw their money without notice, as it ensures that there is enough cash on hand to meet their needs.

Which of the Following Tools Used by the Fed Helps