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Jesani Caban
on Nov 11, 2024

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If a bank's reserves are exactly equal to the required amount of reserves,then it has no excess reserves.

Excess Reserves

The capital reserves held by banks over and above the minimum required by regulators, available for lending or investing.

Required Reserves

The minimum amount of reserves that a bank must hold, as mandated by the central bank, against its deposit liabilities.

  • Apprehend the involvement of banking institutions in the generation of monetary supply.
  • Understand the differences among excess reserves, required reserves, and total reserves.
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Becca CameronNov 14, 2024
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