Principles of Macroeconomics / Unit 11 MAC 1019 short lesson, about 20 seconds
The Reserve Requirement Is Now Zero
Captions available
The idea
The multiplier is built on a required reserve ratio. In the United States that ratio is zero: the Federal Reserve Board cut it to zero percent effective March 26, 2020.
In practice
The earlier regime charged nothing on a first tranche, three percent next, ten above.
Where people slip
Set to zero is not abolished; the Board keeps the authority. Unit twelve covers policy now.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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