Excess Reserves Formula Example How To Calculate Excess Reserves
What are Excess Reserves? Sometimes it is seen that the regulating bank pays interest on the amount extra deposited in the reserve account to encourage the banks to deposit their extra cash balance in the reserve account as it is very necessary for the overall growth of the economy to maintain the cash and funds of the economy properly. Excess Reserves Formula Excess Reserves Formula = Legal Reserves (Amount Deposited) – Reserves Required...