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Question
One method that may be employed by banks to lower required reserves is to
A. transfer deposits offshore on Friday and to transfer them back on Monday.
B. convert demand deposits into MMDA accounts on Friday and reverse the transfer the following Monday.
C. rely more heavily on zero explicit interest-rate deposits.
D. delay posting deposits made on Friday until the following Monday.
E. do nothing, because reserve requirements cannot be avoided.
Answer
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