Operating Controls Allow Managers to Step Back and Look at the Big

question 42

True/False

Operating controls allow managers to step back and look at the big picture and make sure all the pieces of the picture are correctly aligned.

---

Definitions:

Reserve Requirement

This is a monetary policy tool used by central banks, specifying the minimum amount of reserves a bank must hold against its deposits. It influences how much money a bank can lend and thus helps control money supply and inflation.

Excess Reserves

The funds that commercial banks hold in their reserves over and above the regulatory requirement set by the central bank.

Reserve Ratio

The fraction of deposits that a bank is required to hold in reserve and not loan out, as mandated by central banking authorities.

Percent

A term used to describe one hundredth of a whole; a way to express fractions, amounts, or changes in quantities in terms of hundredths.