QuestionJune 5, 2025

Which of the following is not an interest bearing asset of commercial banks? Required reserves Securities Loans All of the above are interest bearing assets of commercial banks.

Which of the following is not an interest bearing asset of commercial banks? Required reserves Securities Loans All of the above are interest bearing assets of commercial banks.
Which of the following is not an interest bearing asset of commercial banks?
Required reserves
Securities
Loans
All of the above are interest bearing assets of commercial banks.

Solution
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Answer

Required reserves Explanation 1. Identify interest-bearing assets Interest-bearing assets generate income through interest. Securities and loans are interest-bearing as they earn interest for banks. 2. Analyze required reserves Required reserves are funds that banks must hold and do not earn interest, thus not an interest-bearing asset.

Explanation

1. Identify interest-bearing assets<br /> Interest-bearing assets generate income through interest. Securities and loans are interest-bearing as they earn interest for banks.<br /><br />2. Analyze required reserves<br /> Required reserves are funds that banks must hold and do not earn interest, thus not an interest-bearing asset.
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