Reserve Requirements

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Quotes of the day:

All that is gold does not glitter; not all those that wander are lost.

— J. R. R. Tolkien, The Fellowship of the Ring, 1954

Reserve requirements are the amount of cash that banks must have, in their vaults or at the closest Federal Reserve bank, in line with deposits made by their customers. Set by the Fed’s board of governors, reserve requirements are one of the three main tools of monetary policy — the other two tools are open market operations and the discount rate.

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Date posted: Jul 5, 2016

The Money Multiplier and Reserve Requirement

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$Money creation in a fractional reserve system | Financial sector | AP Macroeconomics | Khan Academy$

Title: Money creation in a fractional reserve system | Financial sector | AP Macroeconomics | Khan Academy
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