Asked by Grant Messenger on Jun 16, 2024
Verified
If a bank's actual reserves are greater than its required reserves,it has _______.
Actual Reserves
The total funds a bank has in its vault or deposited with the central bank, available for immediate use.
Required Reserves
Required reserves refer to the minimum amount of funds that a bank must hold in reserve against deposits, as mandated by central banking regulations to ensure bank liquidity.
Excess Reserves
The reserves that banks hold over and above the regulatory requirements set by the central bank or banking regulator.
- Comprehend the operational mechanics of banks including reserve requirements.
Verified Answer
Learning Objectives
- Comprehend the operational mechanics of banks including reserve requirements.
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