Which of the Following Is True Regarding the Required Reserve

question 17

Multiple Choice

Which of the following is true regarding the required reserve ratio?

• A) The ratio determines the amount of excess reserves a bank must hold.
• B) The ratio is only enforced against banks that are operating in a risky manner.
• C) The ratio determines the legally required amount of reserves a bank must hold.
• D) None of the above answers is correct.

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Definitions:

Aphagia

The inability to swallow or the loss of swallowing reflex, often due to neurologic or muscular disorders.

Hyperphagia

Overeating that leads to significant weight gain.

Lesioned

Having suffered damage or injury to a body part, organ, or tissue, often referring to specific areas of the brain in medical contexts.

Hypothalamus

A small region of the brain that plays a critical role in hormone production, regulation of body temperature, hunger, thirst, and circadian rhythms.