General Accounting question Suppose a government has no debt and a balancedbudget. Suddenly, it decides to spend $10 billion whileraising only $8 billion worth of taxes. What will be thegovernment's deficit?

The government's deficit will be the difference between its spending and its tax revenue. In this…

Answered: Suppose a government has no debt and a…

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter3: Financial Statements, Tools, And Budgets

Section: Chapter Questions

Problem 1LTAI

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Suppose the Federal Reserve increased deposits by $100 billion, but the reserve requirementon all deposits was 100%. What impact would the change in deposits have on the moneysupply? Group of answer choices The money supply would increase by $100 billion. The money supply would increase by an infinite amount. The money supply would decrease by $100 billion. The money supply would decrease by an infinite amount. The money supply would not change.
Which of the following does not explain why a peso today is worth more than a peso to be received in the future? a. the peso can be invested today and earn interest. b. peso may not be in demand in the future. c. there is risk of nonpayment in the future. d. inflation will reduce purchasing power of a future peso.
The banking system has $8,000 in reserve, $22,000 in loans, and $30,000 in deposits. If the reserve requirement is 10%. What is the maximum amount of loans the banking system could make? A: If the Fed lowers reserve requirement to 5%, the banking system converts all excess reserves to loans, but borrowers return only 50% of these funds to the banking system as deposits. What is the maximum amount of loans the banking system could make? B: If the Fed lowers reserve requirement to 5%, the banking system converts 75% excess reserves to loans, but borrowers return only 60% of these funds to the banking system as deposits. What is the maximum amount of loans the banking system could make?
Give typing answer with explanation and conclusion
We have the following information about a bank's balance sheet. Rate sensitive assets = $10,000,000 Fixed-rate assets = $20,000,000 Rate sensitive liabilities = $4,000,000 Fixed-rate liabilities = $26,000,000 Let's do a simple gap analysis. If the interest rate falls by 5 percent, O a. The bank will lose $300,000. O b. The bank will lose $500,000. O c. The bank will lose $200,000. O d. The bank will gain $300,000. O e. The bank will gain $200,000.
9. The treasurer of XYZ Corp. knows that the company will need to lend $100 million in one year for a one year period. LIBOR rates today are at 4% but the company's treasurer expects LIBOR rates to go down to 2% in 1 year. If treasurer's expectations turn out to be correct the company will be forced to lend at a lower rate unless some sort of hedge is created to protect the rate of return on the loan. In this situation the XYZ's spot market risk exposure is and the treasurer should pay and receive under the FRA agreement in order to hedge its spot market risk exposure. Short; Pay LIBOR; Receive Fixed b. Short; Pay Fixed; Receive LIBOR Long; Pay LIBOR; Receive Fixed d. Long; Pay Fixed; Receive LIBOR Neutral; Pay Fixed; Receive LIBOR a. с. е.
Consider a failing bank. How much is a deposit of $300,000 if the CDIC uses the payoff method? The purchase-and-assumption method? Which method is more costly to taxpayers? Using the payoff method, the $300,000 deposit is worth $ (Round to the nearest dollar) Using the purchase-and-assumption method, a deposit of $300,000 is worth $ (Round to the nearest dollar) Which method is more costly to taxpayers? Select the best answer: A. The payoff method is more costly, since taxpayers will only pay $0.10 on the dollar. B. The purchase and assumption method is more costly, because depositors receive the full value of their deposits. C. The purchase and assumption method is more costly, because depositors will refuse to keep account balances in excess of $100,000 in a single bank. D. The payoff method is more costly, since the cost to insure the fund will be lower.
A)What is the amount of RSA, RSL and the income gap amount? B) Calculate the duration gap. C)What is the change in this bank’s net income if the interest rises by 1%, does it go up or does it go down? Show work D) What happens when the interest rises by 1% to this bank’s asset value, liability value and the net worth in dollar amounts? Show work.
Can you please solve this accounting question ?
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2. The Coldmarket government is considering several excise taxes on wool. They need to generate at least $1,150 in revenue to fund the construction of the fort, but they also wish to minimize the loss of surplus to consumers and producers. They are considering the following excise tax amounts: $1.50 $3.00 $4.50 $6.00
am. 118.

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Suppose a government has no debt and a balanced budget. Suddenly, it decides to spend $10 billion while raising only $8 billion worth of taxes. What will be the government's deficit?