Another Method That May Be Employed by Banks to Lower

question 31

Multiple Choice

Another method that may be employed by banks to lower required reserves is to

• A)transfer deposits to another domestic bank on Friday and transfer them back on the following Monday.
• B)sweep demand deposits into higher interest-bearing accounts on Friday with a return sweep the following Monday.
• C)rely more heavily on zero explicit interest-rate deposits.
• D)delay posting deposits made on Friday until the following Monday.
• E)do nothing, because reserve requirements cannot be avoided.

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