finance its credit​ policy

/in /by

Suppose that to finance its credit​ policy, the Fed pays an annual interest rate of 0.25 percent on bank reserves. During the course of the current​ year, banks hold ​$1.4 trillion in reserves.

What is the total amount of interest the Fed pays banks during the​ year? The Fed pays banks ​$___________ billion of interest during the year.

 
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