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What term indicates the percentage of banks total deposit that must be kept in its own vaults?
reserve ratio
What is the purpose of cash reserve ratio?
CRR stands for Cash Reserve Ratio. This is the amount of money banks have to deposit with the central bank and this amount depends on the amount of total deposits held by the bank. It is used the Central bank to control the amount of cashflow in the market and the amount of money the banks have for lending to the public
What is a bank's reserve-to-deposit ratio?
this is the amount of deposit the central bank authorise bank to keep them
What do banks do with your money once you deposit it?
Banks use the money you deposit to lend to other customers, invest in financial markets, and keep a portion in reserve to meet withdrawal demands.
What accurately describes how raising the required reserve reserve ratio reduces the money supply?
When the required reserve ratio is raised, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
What term indicates the percentage of a banks total deposit that must be kept in its own vaults?
reserve ratio
What term indicates the percentage of banks total deposit that must be kept in its own vaults?
reserve ratio
What accurately describes how lowering the required reserve ratio increases the money supply?
When the required reserve ratio is lowered, banks can loan out more money.
What is the purpose of cash reserve ratio?
CRR stands for Cash Reserve Ratio. This is the amount of money banks have to deposit with the central bank and this amount depends on the amount of total deposits held by the bank. It is used the Central bank to control the amount of cashflow in the market and the amount of money the banks have for lending to the public
The amounts of cash that individual banks have on hand or on deposit at the Federal Reserve Bank are known as .?
Reserve
The amounts of cash that individual banks have on hand or on deposit at the Federal Reserve Bank are known as?
Reserve
What is a bank's reserve-to-deposit ratio?
this is the amount of deposit the central bank authorise bank to keep them
What describes how lowering the required reserve ratio reduces the money supply?
When the required reserve ratio is lowered, banks can loan out more money.
What do banks do with your money once you deposit it?
Banks use the money you deposit to lend to other customers, invest in financial markets, and keep a portion in reserve to meet withdrawal demands.
How does the Federal Reserve help during bank runs?
The Federal Reserve provides deposit insurance and acts as a lender to commercial banks.
What is the required reserve ratio (RRR)?
the portion of a deposit that a bank must keep on hand
Who has the power to determine what the margin requirement will be for the member banks?
Usually the Central Banks of each country decide such margin requirements. Ratios like Cash Reserve Ratio, Liquidity Ratio etc are set by the Central Banks like Reserve Bank of India or Federal Reserve of USA. All member banks are expected and supposed to follow these guidelines set by the central banks.
