The demand for international reserves refers to the amount of international reserves that a country's monetary authorities are willing to exchange for a certain amount of actual resources. The opportunity cost of holding international reserves is the opportunity cost of holding international reserves, that is, the income that the resources actually abandoned by holding international reserves may bring to the country. The more international reserves a country's monetary authorities hold, the more real resources they can give up at present. If a country's monetary authorities reduce its international reserves, the saved foreign exchange can be converted into practical resources such as imported goods and services to serve the country's current economic development.
People usually use the investment rate of 1- 1 resources with convertible foreign exchange funds to represent the opportunity cost of holding international reserves. The higher the return on investment of imported resources, the greater the opportunity cost of holding international reserves. Generally speaking, developing countries are more constrained by resources in their economic development, and the investment rate of resources (especially equipment, technology and important raw materials) entering Japan is higher, so the opportunity cost of holding international reserves will be higher than that of developed countries.