3. Describe the clearing house and define its economic advantages.
4. If there are twenty banks in a town and no clearing house, how many collections would have to be made by all the banks daily assuming that each day depositors of each bank receive checks on the other nineteen banks?
5. Does a clearing house enable the banks that belong to it to get along with a smaller cash reserve?
[CHAPTER 9]
THE FEDERAL RESERVE ACT
References.
Conway, Thomas, Jr., The financial policy of the Federal reserve banks. J. P. E., 22: 319-331. 1914.
Federal Reserve Board, The Federal Reserve Bulletin. Monthly.
*Phillips, ch. XXXI.
Scott, W. A., Banking reserves under the Federal Reserve Act. J. P. E., 22: 332-344. 1914.
White, bk. III, ch. XXII and appendices D and E.
Willis, H. P., The Federal Reserve Act. A. E. Rev., 4: 1-24. 1914.
Questions.
1. Name and contrast the different kinds of banks in the United States.