2.6. Determine the following: 2.6.1.Herfindahl-Hirschman index (HHI) with the following information of the six banks' deposits; 2.6.2.If the biggest and smallest bank (in terms of deposits) merge, what will be the HHI for all the remaining banks? | 2.6.3.Will the merger be allowed? (Ch. 9) A B C Bank ($ in millions) 70 60 80 90 D 120 E 140 F 200

2.6. Determine the following: 2.6.1.Herfindahl-Hirschman index (HHI) with the following information of the six banks' deposits; 2.6.2.If the biggest and smallest bank (in terms of deposits) merge, what will be the HHI for all the remaining banks? | 2.6.3.Will the merger be allowed? (Ch. 9) A B C Bank ($ in millions) 70 60 80 90 D 120 E 140 F 200

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Suppose that: Banks Debt Ratio Total Liabilities Total Capital Net Income Bank Alpha 1.50 $3,106,717m $279,354m $27,410m Bank Beta 1.39 $2,059,798m $200,523m $11,370m Which one is the best performing bank? a. Bank Alphab. Bank Betac. Both Banks
The following table contains balance sheet information for Dual bank. All assets and liabilities are currently priced at par. Assets Commercial bills T-notes T-bonds Loans Amount (Smillion) Duration 900 400 (?) 700 Liabilities 0.5 Deposits 0.9 Federal Funds 2 0.7 Amount (Smillion) Duration 500 500 2 If the financial institution has instead invested $400 million on the T- bonds, what would be the impact on the firms' market value of equity if the entire yield curve shifts upward by 30 basis points [i.e., DR/(1+R) = 0.0030]?
Assume the following bid and ask rates of the pound for two banks as shown below: Bid Ask Bank A $1.40 $1.41 Bank B $1.38 $1.39 As locational arbitrage occurs, _______. A. the bid rate for pounds at Bank A will decrease; the ask rate for pounds at Bank B will increase B. the bid rate for pounds at Bank A will increase; the ask rate for pounds at Bank B will increase C. the bid rate for pounds at Bank A will increase; the ask rate for pounds at Bank B will decrease D. the bid rate for pounds at Bank A will decrease; the ask rate for pounds at Bank B will decrease
Correct option? ? General Accounting
PLEASE SOLVE
Suppose the simplified consolidated balance sheet shown below is for the entire commercial banking system. All figures are in billions. The reserve ratio is 25 percent. a. What amount of excess reserves does the commercial banking system have? What is the maximum amount the banking system might lend? Show in column 1 how the consolidated balance sheet would look after this amount has been lent. What is the monetary multiplier?b. Answer the questions in part a assuming the reserve ratio is 20 percent. Explain the resulting difference in the lending ability of the commercial banking system.
Ubu Bank has the following assets and liabilities : Asset X has a maturity of 3 years and a market value of $600,000 and asset Y has a maturity of 9 years and a market value of $500,000. Liability A has a maturity of 2 years and a market value of $700,000 and liability B has a maturity of 8 years and a market value of $700,000. What is the maturity gap of the bank ? Round your final answer to 2 decimal places. E.g. if the final answer is -3.59 years, type -3.59 in the answer box. If the final answer is 3.59 years, type 3.59 in the box .
Use a T accounts to illustrate the changes for the Bank of Canada and ABC banks If the Bank of Canada conducts open market operation by selling $5M of bonds to the ABC Bank. What will happen to the following and use a "T" to explain a. money base? b. Reserves for the Bank of Canada and ABC bank?
Answer in typing
Imagine that the banking system's balance sheet can be represented by the following t-account: Assets LIABILITIES AND NET WORTH RESERVES 200 DEPOSITS 2000 BONDS 800 LOANS 1000 NETWORTH 0 TOTAL 2000 TOTAL 2000 Assuming the bank is "loaned up" the required reserve ratio is ___________ (round to two decimal places) The money multiplier is ___________ Imagine that the central bank uses open market operations to buy $300 worth of bonds from the bank above. Fill in the following t-account assuming that the money multiplier has taken its full effect: ASSETS LIABILITIES AND NET WORTH RESERVES __?___ DEPOSITS ___?__ BONDS ____?___ LOANS ____?____ NET WORTH ___?___ TOTAL _____?______ TOTAL ___?___
If a bank quintuples the amount of its capital and ROA stays constant, what will happen to ROE? ROE will to of what the ROE was before the bank quintupled the amount of its capital. 500.0% 50.0% 20.0%
Lambrook Bank has the following assets and liabilities: Asset A has a maturity of 4 years and a market value of $600,000 and asset B has a maturity of 6 years and a market value of $800,000. Liability X has a maturity of 2 years and a market value of $200,000 and liability Y has a maturity of 5 years and a market value of $300,000. What is the maturity gap of the bank? . .

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