Examlex
Choose the correct statement about the diagram below.
Government Securities
Financial instruments issued by the government to borrow money from the public.
Excess Reserves
The amounts of cash banks hold in reserve over and above the regulatory requirements, which can influence their capacity for lending and overall liquidity in the economy.
Required Reserves
Required Reserves refer to the minimum reserve of cash that banks must hold either in their vaults or on deposit with the central bank, as mandated by financial regulations.
Total Reserves
The sum of a bank's deposits held in the central bank plus its cash on hand, serving as a buffer against potential withdrawals.
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