Answered

10. What are excess reserves?
reserves greater than the required amounts
○ rates of interest banks charge on short-term loans to their best customers
the ratio of reserves to deposits required of banks by the Federal Reserve
the buying and selling of government securities to alter the supply of money



Answer :

GinnyAnswer

Final answer:

Excess reserves are additional reserves banks hold above the required limit, affecting the money supply and monetary policy.


Explanation:

Excess reserves are reserves that banks hold above the legally mandated limit. Banks may choose to hold excess reserves, especially during economic uncertainties like recessions. Excess reserves impact the money supply and are part of monetary policy considerations.


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