If a Bank Is Subject to a Reserve Requirement of 3

question 262

True/False

If a bank is subject to a reserve requirement of 3% and its reserve ratio is 1%, this bank is considered highly liquid.

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Definitions:

Contract Comes into Existence

The point at which an agreement between two or more parties is legally enforceable, usually triggered by an offer, acceptance, and adequate consideration.

Specific Performance

A legal remedy requiring a party to fulfill their obligations under a contract, rather than providing monetary compensation for failing to do so.

Contract Remedy

The legal means available to a party to enforce, redress, or protect their rights under a contract.

Rescission

The legal act of voiding a contract and returning the parties involved to their original positions, as if the contract had never been executed.