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Why must banks keep money on reserve?
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Why must banks keep money on reserve?

User Niquan
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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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User Frank Myat Thu
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