- 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
Banks are required by law to keep on hand. to back up deposits, a minimum reserve of their checking deposits. This reserve is known as ______.
A. excess reserves
B. required reserves
C. borrowed reserves
Explanation: Excess reserves are actual reserves that exceed the legal requirement.
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