First Savings of Pierce, lowa, reported transaction deposits of $75 million (the daily average for the latest two-week reserve computation period). Its nonpersonal time deposits over the most recent reserve computation period averaged $37 million daily, while vault cash averaged $0.978 million over the vault-cash computation period. Assuming that reserve requirements on transaction deposits are 3 percent for deposits over $7.8 million and up to $48.3 million and 10 percent for all transaction deposits over $48.3 million while time deposits carry a 3 percent required reserve, calculate this savings institution's required daily average reserve balance at the Federal Reserve Bank in the district.
First Savings of Pierce, lowa, reported transaction deposits of $75 million (the daily average for the latest two-week reserve computation period). Its nonpersonal time deposits over the most recent reserve computation period averaged $37 million daily, while vault cash averaged $0.978 million over the vault-cash computation period. Assuming that reserve requirements on transaction deposits are 3 percent for deposits over $7.8 million and up to $48.3 million and 10 percent for all transaction deposits over $48.3 million while time deposits carry a 3 percent required reserve, calculate this savings institution's required daily average reserve balance at the Federal Reserve Bank in the district.
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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First Savings of Pierce, lowa, reported transaction deposits of $75 million (the daily average for the latest two-week reserve computation period). its nonpersonal time deposits over the most recent reserve computation period averaged $37 million daily, while vault cash averaged $0.978 million over the vauit-cash computation period. Assuming that reserve requirements on transaction deposits are 3 percent for deposits over §7.8 million and up to $4.3 million and 10 percent for all transaction deposits over $48.3 million while time deposits carry a 3 percent required reserve , calculate this savings institution’s required daly average reserve balance at the Federal Reserve Bank in the district.
Transcribed Image Text:First Savings of Pierce, lowa, reported transaction deposits of $75 million (the daily average for the latest two-week reserve computation period). Its nonpersonal
time deposits over the most recent reserve computation period averaged $37 million daily, while vault cash averaged $0.978 million over the vault-cash
computation period. Assuming that reserve requirements on transaction deposits are 3 percent for deposits over $7.8 million and up to $48.3 million and 10
percent for all transaction deposits over $48.3 million while time deposits carry a 3 percent required reserve, calculate this savings institution's required daily
average reserve balance at the Federal Reserve Bank in the district.
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