Answer:
Option D: Ensure that depositors can withdraw their money if they wish to
Explanation:
Depository institutions such as commercial banks are required by the Federal Reserve to hold in its vault or deposit in the Federal reserve, a fraction of its cash reserve. The Federal sets the minimum required reserve for each commercial bank.
These reserves are there to ensure that there is enough liquidity (cash) to cater to any demand for withdrawals by customers. These reserves cannot be loaned but are kept to ensure, customers who make large or surprise withdrawals are not disappointed. The cash reserves serves as an antidote of sorts to panic withdrawals by customers.
