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A bank has two assets: 70 percent in one-month Treasury bills and 30 percent in real estate loans. If the bank must liquidate its T-bills today, it receives $95 per $100 of face value; if it can wait to liquidate them on maturity (in one month's time), it will receive $100 per $100 of face value. If the bank has to liquidate its real estate loans today, it receives $90 per $100 of face value liquidation at the end of one month will produce $92 per $100 of face value. The one-month liquidity index value for this bank's asset portfolio is: Select one: a. 1.10 b. 0.958 c. 0.979 d. 0.964 e. 1.06 Clear my choice

A bank has two assets: 70 percent in one-month Treasury bills and 30 percent in real estate loans. If the bank must liquidate its T-bills today, it receives $95 per $100 of face value; if it can wait to liquidate them on maturity (in one month's time), it will receive $100 per $100 of face value. If the bank has to liquidate its real estate loans today, it receives $90 per $100 of face value liquidation at the end of one month will produce $92 per $100 of face value. The one-month liquidity index value for this bank's asset portfolio is: Select one: a. 1.10 b. 0.958 c. 0.979 d. 0.964 e. 1.06 Clear my choice

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A bank has two assets: 70 percent in one-month Treasury bills and 30 percent in real estate loans. If the bank must liquidate its T-bills today, it receives $95 per $100 of face value; if it can wait to liquidate them on maturity (in one month's time), it will receive $100 per $100 of face value. If the bank has to liquidate its real estate loans today, it receives $90 per $100 of face value liquidation at the end of one month will produce $92 per $100 of face value. The one-month liquidity index value for this bank's asset portfolio is:

Select one:
a.

1.10

b.

0.958

c.

0.979

d.

0.964

e.

1.06

Clear my choice
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