If Banks Do Not Have Enough Reserves to Satisfy the Reserve

question 107

True/False

If banks do not have enough reserves to satisfy the reserve requirement,they can borrow additional reserves in the federal funds market.
The federal funds market is a market where banks can borrow overnight from other banks to maintain the required minimum level of reserves.

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Definitions:

Mastication

Process of chewing.

Chemical Digestion

The process by which food is broken down by enzymes and acids in the digestive system into substances the body can use.

Enteric Plexus

is a network of neurons in the walls of the digestive tract, helping regulate the digestive system's processes.

Myenteric Plexus

Plexus of unmelinated fibers and postganglionic autonomic cell bodies lying in the muscular coat of the esophagus, stomach, and intestines; communicates with the submucosal plexuses.