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When the required reserve ratio is lowered, banks can loan out more money.
When the required reserve ratio is high, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
When the required reserve ratio is raised, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
When the required reserve ratio is raised, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
When the required reserve ratio is high, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
If they lower the ratio, banks do not have to hold as much cash (which gains no interest), the banks will attempt to loan this money out and make money, this can stimulate investment. Increase or decrease in the money supply (APEX)
When the required reserve ratio is lowered, banks can loan out more money.
The ideal current ratio for banks 1.33 : 1
When the required reserve ratio is raised, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
So that the bank's don't run out of money when customers make withdrawals.
how do we calculate credit loss ratio in banks financials
The ratio is 270 : 80 which can be simplified, if required.