cguzman387 cguzman387

01-06-2017
Social Studies

contestada

Why does the Fed pay interest to banks?

It is interest on money held in reserve.
It is interest on credit available to the Fed.
It is interest on loans taken by the Fed.
It is interest on government investments.

Respuesta :

kgiles4 kgiles4

03-06-2017

A.) It is interest on money held in reserve.

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Tundexi Tundexi

19-01-2022

The Fed pay interest to banks because it is a interest on money held in reserve by them.

What is the institution called Federal reserve?

The Fed means Federal reserves.

The Federal reserves is an institution which holds the reserve requirement of commercial banks in the country.

The reserves placed with them are sometime loaned out for interest purpose.

Hence, the Fed pay interest to banks because it is a interest on money held in reserve by them.

Therefore, the Option A is correct.

Read more about Federal reserve

brainly.com/question/7798250

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