In the long run:

The higher the interest rate paid on certificates of deposit and other nontransaction deposits, other things being equal, the less people would be expected to hold in demand deposits

a. True b. False Indicate whether the statement is true or false

Excess reserves make a bank less vulnerable to runs, but bankers do not like to hold excess reserves because holding excess reserves

A. are disliked by depositors. B. means lower profits for banks. C. are discouraged by government regulators. D. All of these responses are correct.