Excess reserves refer to the

Question

difference between a bank's vault cash and its reserves deposited at the Reserve Bank

minimum amount of actual reserves a bank must keep on hand to back up its customers deposits

difference between actual reserves and loans

differences between actual reserves and required reserves

Question 12
Question 12

Answer 1

Excess reserves refer to the difference between actual reserves and required reserves.

This means that excess reserves are the funds that a bank holds over and above the required minimum reserves it must maintain to back its customers' deposits.