Which of the following financial institutions does NOT have to meet minimum reserve ratios?i. the Fedii. commercial banksiii. credit unions

BANKING GENERAL KNOWLEDGE

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	iii only
B	i, ii, and iii
C	i only
D	ii and iii
E	ii only

Explanation:

Detailed explanation-1: -Open market operations. Which of the following is not required to satisfy Fed minimum reserve requirements? Pawn shops.

Detailed explanation-2: -3 As of 2022, the IORB rate is 0.10%. U.S. commercial banks are required to hold reserves against their total reservable liabilities (deposits) which cannot be lent out by the bank. Reservable liabilities include net transaction accounts, nonpersonal time deposits and Eurocurrency liabilities.

Detailed explanation-3: -National Bank National banks are required to be members of the Federal Reserve System and belong to the Federal Deposit Insurance Corporation.

Detailed explanation-4: -The required reserve ratio can be calculated by simply dividing the amount of money a bank is required to hold in reserve by the amount of money it has on deposit. For example, if a bank has $10 million in deposits and $500, 000 are required to be held in reserve, then the required reserve ratio would be 1/20 or 5%.

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