Below is the simplified balance sheet of Gorgonzolan commercial banks at some point in time. Liabilities Assets Currency (reserves) Loans Amount 400,000 Deposits 100,000 Amount 500,000 Assume that the Gorgonzolan commercial banks desire to hold reserves of 5 percent of deposits and that the public holds no currency long term. Instructions: Enter your responses as whole numbers. a. Given the data in the balance sheet, the Gorgonzolan commercial banks want to hold 25000 in reserves. b. The Gorgonzolan commercial banks currently have 375000 in extra reserves that they would like to lend out. c. Assuming that no additional reserves enter the Gorgonzolan banking system, the final values of bank reserves, loans, and deposits are: Final consolidated balance sheet Assets Currency Final value of bank reserves Loans Amount 450000 O 450000 O d. The final value of the money supply is: 900000 Liabilities Deposits guilders. Amount 900000
Below is the simplified balance sheet of Gorgonzolan commercial banks at some point in time. Liabilities Assets Currency (reserves) Loans Amount 400,000 Deposits 100,000 Amount 500,000 Assume that the Gorgonzolan commercial banks desire to hold reserves of 5 percent of deposits and that the public holds no currency long term. Instructions: Enter your responses as whole numbers. a. Given the data in the balance sheet, the Gorgonzolan commercial banks want to hold 25000 in reserves. b. The Gorgonzolan commercial banks currently have 375000 in extra reserves that they would like to lend out. c. Assuming that no additional reserves enter the Gorgonzolan banking system, the final values of bank reserves, loans, and deposits are: Final consolidated balance sheet Assets Currency Final value of bank reserves Loans Amount 450000 O 450000 O d. The final value of the money supply is: 900000 Liabilities Deposits guilders. Amount 900000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Only part c and d please thanks explain
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 2 images
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education