A corporation which has $70 billion in assets and $20 billion in net value should have $50 billion in liabilities. Reserves with a $20 billion surplus. $20 billion in liabilities. Reserves with a $50 billion surplus
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A corporation which has $70 billion in assets and $20 billion in net value should have
$50 billion in liabilities.
Reserves with a $20 billion surplus.
$20 billion in liabilities.
Reserves with a $50 billion surplus.
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- A bank that has assets of $70 billion and a net worth of $20 billion must have Multiple Choice liabilities of $50 billion. excess reserves of $20 billion. liabilities of $20 billion. excess reserves of $50 billion.To buy securities the Fed offers a high price and increases interest rates. True or FalseBanks can make loans as long as they have excess government securities. required reserves. deposits. excess reserves. reserves.
- Banks hold reserves in order to: cover their customers' withdrawal needs. cover the banks' investments. offset their liabilities. satisfy stockholders.Economic stealth bank has deposits of $700 million. And hold reserves of $20 million and has purchased government bonds worth $350 million. The banks loans, if sold at the current market value, would be worth $600 million. What is the value of the biggest total liabilities?Assets Reserves Loans Bank's Balance Sheet $150 $600 Liabilities and Owners' Equity Deposits Debt Securities $750 Capital (owners' equity) $1,200 Suppose a new customer adds $100 to his account at North Central National Bank, which the owners of the bank then use to make $100 worth of new loans. This would increase the loans account and the The size of the monetary base $200 This would also bring the leverage ratio from its initial value of The reserve requirement $100 The total value of liabilities Which of the following do bankers consider when deciding how to allocate their assets? Check all that apply. account. to a new value of
- Coin Bank has deposits of $350 million. It holds reserves of $30 million and government bonds worth $70 million. If the bank sells its loans at market value of $400 million, what will its total assets equal? $500 million $750 million $450 million $380 millionAssets Vault Cash Deposits at Fed Loans Total $50,000 $200,000 $600,000 $850,000 Liabilities and Net Worth First Southern's bank reserves are equal to $ checking deposits, First Southern' would maintain $ reserves over and above the desired amount. Deposits $850,000 Total The increase in the money supply will be $850,000 If First Southern bank wanted to maintain 0.10 of its assets as reserves against as reserves. Therefore, it would have $ as additional If First Southern uses the reserves above the desired level to extend additional loans, the money supply would increase by S If First Southern wanted to maintain 0.05 of its assets as reserves against checking deposits, First Southern' would maintain S as reserves, additional reserves would be $ and the increase in the money supply would be $ if First Southern chooses a desired reserve ratio of 0.05.QUESTION 12 If the Federal Reserve System sells $5 billion of government securities to commercial banks, the banks' reserves would increase by $5 billion be added to net worth. decrease by $5 billion. remain the same.
- Vault cash is equal to $2 million, deposits by depository institutions at the central bank are $3 million, the monetary base is $15 million, and bank deposits are $35 million. Currency held by the nonbank public is $ million IMoney Market Equilibrium interest rate of 3% Graph & Fill in Blanks 1st Blank options are rise or fall 2nd Blank options are $0.25 billion, $0.5 billion, $1 billion 3rd Blank options are decrease or increase 4th Blank options are $0.5 billion, $1 billion, $0.4 billion 5th Blank Options are multiplier, crowding-out, automatic stabilizer, liquidity preferenceA banking institution has $80000 in deposits. There are $6,000 in actual reserves, of which $2,000 are compliance with generally accepted accounting. Describe the RRR.