Suppose that the bank holds $15m of treasury bonds, $10m of reserves, $30m of checkable deposits, $20m of time deposits and has $6m of capital. How much loan does the bank have if we know it doesn't have any other assets or liabilities not listed here? Suppose that checkable deposits and reservers pay 0 interest The interest rate on treasuries is 3% Loans pay 7% and time deposits pay 5% How much profits does the bank make? What is the bank's return on assets?
Suppose that the bank holds $15m of treasury bonds, $10m of reserves, $30m of checkable deposits, $20m of time deposits and has $6m of capital. How much loan does the bank have if we know it doesn't have any other assets or liabilities not listed here? Suppose that checkable deposits and reservers pay 0 interest The interest rate on treasuries is 3% Loans pay 7% and time deposits pay 5% How much profits does the bank make? What is the bank's return on assets?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Suppose that the bank holds $15m of treasury bonds, $10m of reserves, $30m of checkable deposits, $20m of time deposits and has $6m of capital.
How much loan does the bank have if we know it doesn't have any other assets or liabilities not listed here?
Suppose that checkable deposits and reservers pay 0 interest
The interest rate on treasuries is 3%
Loans pay 7%
and time deposits pay 5%
How much profits does the bank make?
What is the bank's return on assets?
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