2 Consider the balance sheet for the Wahoo Bank as presented here. Use arequired reserve ratio of 10% and assume that the bank keeps no excessreserves.Wahoo Bank Balance SheetAssetsLiabilities and net worthGovernmentsecuritiesRequired reservesExcess reserves$1,600$400$0$3,000Liabilities:Checking deposits$4,000Net worth$1,000LoansTotal assests$5000What will change on the balance sheet if Alexa deposits $200 into her checkingaccount?Click to view larger image, eRequired reserves will nciatc by $200.Outstanding liabilities decrease by $200.Required reserves decrease by $200.Outstanding liabilities increase by $200.

Checking deposit is the liabilities of bank Each bank has to keep a certain portion of its checking…

Answered: Consider the balance sheet for the…

Consider the balance sheet for the Wahoo Bank as presented here. Use a required reserve ratio of 10% and assume that the bank keeps no excess reserves. Wahoo Bank Balance Sheet

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Consider the balance sheet for the Wahoo Bank as presented here. Use a
required reserve ratio of 10% and assume that the bank keeps no excess
reserves.
Wahoo Bank Balance Sheet
Assets
Liabilities and net worth
Government
securities
Required reserves
Excess reserves
$1,600
$400
$0
$3,000
Liabilities:
Checking deposits
$4,000
Net worth
$1,000
Loans
Total assests
$5000
What will change on the balance sheet if Alexa deposits $200 into her checking
account?
Click to view larger image, e
Required reserves will nciatc by $200.
Outstanding liabilities decrease by $200.
Required reserves decrease by $200.
Outstanding liabilities increase by $200.

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