Table 1: Capital Assets. Reserves Loans 20 80 Treasury Securities 10 O Sell $7.0 in loans O Sell $3.5 in loans O Sell $10 in loans O Sell $2 in loans Liabilities Deposits 100 Capital 10 Using the Table 1 above now assume the only way to raise reserves is to sell loans at fifty cents on the dollar. What does the balance sheet look like after the sale of loans?

Table 1: Capital Assets. Reserves Loans 20 80 Treasury Securities 10 O Sell $7.0 in loans O Sell $3.5 in loans O Sell $10 in loans O Sell $2 in loans Liabilities Deposits 100 Capital 10 Using the Table 1 above now assume the only way to raise reserves is to sell loans at fifty cents on the dollar. What does the balance sheet look like after the sale of loans?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Economics In Kentucky, the quantity of money is $160 billion, the current drain ratio is 25% of deposits, and the reserve ratio is 4% of deposits. What is the value of the monetary base in Kentuckty? А. $40.2 billion В. $35.6 billion С. $37.1 billion D. $39.9 billion
2. Consider the following data (all values are in billions of dollars): (b) Currency Transactional deposits Bank reserves June 1930 June 1931 June 1932 $ 3.681 3.995 4.959 21.612 19.888 15.490 3.227 3.307 2.829 (a) Calculate the values for each period for the currency-deposit ratio, the ratio of total reserves to deposits, the monetary base, M1, and the money multiplier. Can you explain why the currency-deposit ratio and the ratio of total reserves to deposits moved as they did between 1930 and 1932(Great depression era)?
Table: Statistics for a Small Economy Item Value (millions) $7 130 Money market mutual funds 18 Checkable deposits 36 Currency and total reserves at the Fed 12 Large-time deposits 20 Demand deposits 14 Cash held by public Small-time deposits The table shows some statistics for a small economy. Based on only the information provided, M2 in this country amounts to: $105 million. $121 million. $137 million. $129 million.
Table 10-2 Last Bank of Cedar Bend Assets: Reserves Loans Liabilities: $25 000 Deposits $180 000 S155 000 efer to the Table 10-2. If the reserve requirement is 10 percent and then someone deposits $50 000 into the bank, what is the bank's reserve osition? alect one: cross a. It will have $52 000 in excess reserves. cros b. It will need to raise reserves by $5000. cros c. It will have $57 000 in excess reserves. d. It will have excess reserves of $2000.
2. When you discover a $20 bill in your coat pocket that you placed there last winter, you find you were unexpectedly using money as a O medium of exchange. store of value. unit of account. factor of production.
Interest Rate Transactions Demand for Money Asset Demand for Money Money Supply 2% $220 $300 $460 4 220 280 460 6 220 260 460 8 220 240 460 10 220 220 460 Based on the given table, an increase in the money supply of $20 billion will cause the equilibrium interest rate to Multiple Choice fall by 4 percentage points. fall by 2 percentage points. Correct rise by 4 percentage points. rise by 2 percentage points.
In an economy, the banks prefer to keep 25% of their deposits in reserve. The population likes to keep their currency holdings equal to 10% of the deposits. Initially, there was zero money in the economy. Then the central bank buys $120 worth of T-bills from a household. The household receives $120 on its checking account. 1. the commercial bank formed reserves and gave out a loan. The population allocated the lent funds between the currency in pockets and checkable accounts. Before anything else happens, how much money is there in the economy at the end of Round 1? ANSWER: 288 For question 1 How is this answer obtained?, How would you solve question 2. 2. In Round 2, more lending, borrowing, and reserve formation takes place. How much is in DEPOSITS in the economy at the end of Round 2?
What are the components of the aggregate demand (AD) curve?
Robert needs to decide between buying a slate pool table for $1,800 or being able to go on a Canadian vacation for $1,000 and still having enough left over to buy a nonslate pool table for $800. Robert opts for the nonslate pool table and the Canadian vacation. Robert has used money in what ways in making his decision? O A. Medium of exchange and a standard unit of account. O B. Store of value and a standard unit of account. OC. Medium of exchange and a method to decrease deferred payments. O D. Medium of exchange and a store of value.
An increase in interest rates in New Zealand all other things constant would Select one: a.raise the value of the $NZ. b.lower the value of the $NZ. c.have no impact on the value of the $NZ. d.lead to a run down of foreign reserves as the Reserve Bank was forced to buy $NZ.
Haley sells a share of stock and deposits the proceeds into her saving account at a bank. a. Her assets as M1- increases, decreases, or stays the same b. Her assets as M2 -increases, decreases, or stays the same c. Reserves at her bank- increases, decreases, or stays the same
- Open-market operations have their initial effect on bank lending. reserves. revenues. profits.