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WAEC Economics 2015 Question 38

Question 38

Financial Institutions

The proportion of commercial banks' total assets kept in the form of highly liquid assets is known as

  1. A.demand deposit
  2. B.fixed deposit
  3. C.cash ratio
  4. D.moral suasion.
Show the answer and explanation

Answer: C (cash ratio)

Explanation

The share of assets banks must keep in cash (liquid form) is the cash (liquidity) ratio.