Economy, asked by bulbulrajput3098, 3 months ago

why it is necessary for commercial banks to keep reserves

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Answered by Anonymous

Answer:

Bank reserves are the cash minimums that must be kept on hand by financial institutions in order to meet central bank requirements. The bank cannot lend the money but must keep it in the vault, on-site or at the central bank, in order to meet any large and unexpected demand for withdrawals.

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