0
Add your answer:
Earn +20 pts
Is revaluation reserve a capital reserve?
Yes...revaluation reserve is a part of capital reserve.
Is revenue reserve a free reserve?
no
What are the examples of revenue reserves?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
What is security premium reserve?
Securities premium reserve is the amount when securities are issued at premium that is more than their face value.
How does the money supply expand?
Central banks control the money supply. In the U.S. the central bank is the Federal Reserve.The Federal Reserve (Fed) has 3 main tools at its disposal to manage the money supply. They are i) the discount rate; ii) the reserve requirement; and iii) open market operations.The discount rate is the interest rate that federal reserve banks charge to qualified private lending institutions for overnight loans accessed from the "discount window". The higher the rate, the less inclined private banks are to borrow. Thus, a higher discount rate constricts the money supply and a lower discount rate expands the money supply.The reserve requirement is the level of funds that a depository institution must hold against specified liabilities. This relates to the whole idea of fractional reserve banking. That is, we expect that banks will make loans from their deposits but they should hold adequate reserves to meet withdrawal requests. A lower reserve requirement expands the money supply.Finally, open market operations relate primarily to the Fed's activity buying and selling US Treasury obligations. The most active markets are in 2-, 5-, and 10-year notes. When the Fed sells bonds for US dollars, dollars are coming out of the system, thus constricting the money supply. When the Fed buys bonds on the open market with US dollars, this injects new dollars into the market, thus expanding the money supply.There are more complicated topics related to your question that you may be interested in reading about, including: Capital Adequacy, the Velocity of Money, Fed guarantee programs.
What is the purpose the reserve requirement?
It protects public deposits.
Decreasing the reserve requirement will?
will discourage aggregate demand.
How can the reserve requirement for banks be used to slow the economys growth?
Increasing the reserve requirement for banks will make less money available to borrowers and thus slow the economy's growth.
Why did the Members banks must leave this with the Fed?
Reserve requirement
What is a result of high reserve requirement?
Less money in the economy.
In reference to federal reserve policy what are reserve requirement?
the percentage of a bank's total deposits that must be kept in its possession
The percentage of the bank's total deposit that it must keep in its own vaults is called the?
required reserve ratio. This ratio is set by the central bank and determines the minimum amount of reserves that a bank must hold relative to its deposits. It helps ensure the stability of the banking system and manage the money supply in the economy.
What is the relationship between the monetary multiplier and reserve ratios?
Money Multiplier is inverse of Reserve Requirement. That is, m = 1/R
What term indicates the percentage of banks total deposit that must be kept in its own vaults?
reserve ratio
What are the funds that banks use to satisfy the reserve requirement?
excess reserves
Are funds that the bank uses to satisfy the reserve requirement?
excess reserves
What is the current reserve requirement of bangko sentral ng pilipinas?
19%
