In the real-world banking system,a bank can eliminate a reserve deficiency by

A) borrowing in the Federal funds market.
B) borrowing from the Fed's discount window.
C) selling securities.
D) Any one of the choices or some combination is possible.

Federal Funds Market

A financial market that allows banks to borrow or lend excess reserves to one another, typically overnight, at an interest rate called the federal funds rate.

Discount Window

A monetary policy tool used by central banks, providing short-term loans to commercial banks to help them meet reserve requirements or alleviate liquidity shortages.

Reserve Deficiency

A situation in which a bank does not have enough reserves to meet the central bank's requirements.