Solution-Why would banks choose to hold excess reserves

Why would banks choose to hold excess reserves

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Banks earn profit by loaning out money. If banks decide to hold excess reserves (reserves above those required), they will have less money to lend and, thus, earn less profit. Why would banks choose to hold excess reserves?

Reference no: EM131752469

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Why would banks choose to hold excess reserves

Reference no: EM131752469

Reference no: EM131752469

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