Reserve requirements that may be imposed on an economy's banks by its central bank specify that banks by its central bank specify that banks reserve must be a minimum percentage of them ?
Correct answer: B. deposits
- A. assets
- B. deposits
- C. loans
- D. government bonds
Explanation
Reserve requirements specify the minimum fraction of customer deposits that banks must retain as reserves rather than lend out. The requirement is therefore stated as a percentage of deposits.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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