Which of the Following Is a Reason Why a Bank

question 68

Multiple Choice

Which of the following is a reason why a bank may hold excess reserves?

• A) It earns more interest on reserves than on loans.
• B) It is required to do so.
• C) It may want flexibility to increase its loans if interest rates rise in the near future.
• D) Banks often expect a drop in the required reserve ratio.
• E) Banks often expect a rise in the required reserve ratio.

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Definitions:

Neuromuscular Impairment

A condition that disrupts the normal functioning of the muscles and the nerves that control them.

Smoking-Related Deaths

Deaths that can be directly attributed to smoking, including diseases such as lung cancer, chronic obstructive pulmonary disease (COPD), and heart disease.

Relative Risk

The risk a person has for a particular disease compared with the risk of other people who do not have that person’s condition or lifestyle.

Nonsmokers

Individuals who do not smoke cigarettes and are not exposed to the habit of inhaling smoke from combustible tobacco products.