- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 4. Monetary Policy
- Subject 2. Monetary Policy Tools and Monetary Transmission
CFA Practice Question
The cash in a bank's vault plus its deposits at Federal Reserve banks is ______.
B. assets
C. reserves
A. M1
B. assets
C. reserves
Correct Answer: C
User Contributed Comments 5
| User | Comment |
|---|---|
| indrasenareddy | why is it not B. Can the reserves of the Bank - assets ? |
| 2014 | Why not B as answer as it specifies cash in bank vault and "its" deposits with federal reserve bank. By specifying its it implies reserve on this cash is already deposited with fed |
| Inaganti6 | Reddapppaaaaaa |
| ibrahim18 | Cash in the vault is depositor's money. This is a liability to the bank and not an asset. Thus, the answer cannot be B. It's not A either. |
| xp_acctant | @Ibrahim18: deposit is a liability while cash is an asset to the bank. |