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Reserve requirements are the proportions of the deposits that banks must keep on hand and are not allowed to lend out. For example, if the reserve requirement is 10% and you deposit $100 in a bank. The bank can lend $90 of that $100 to someone else. But it is not allowed to lend the remaining $10.
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Explanation
Reserve requirements are the proportions of the deposits that banks must keep on hand and are not allowed to lend out. For example, if the reserve requirement is 10% and you deposit $100 in a bank. The bank can lend $90 of that $100 to someone else. But it is not allowed to lend the remaining $10.
Words in Bold -> Plosives