The following are the assets and liabilities of agovernment security dealerAssets $150 million 30-day Treasury bills$275 million 91-day treasury bills$90 million 180-day municipal notes$350 million 2-year Treasury notesLiabilities $575 million 14-day repurchaseagreements$290 million 1-year commercial paper$425 million 30-day repurchaseagreementsUse the repricing model to determine thefunding gap for a maturity bucket of 91 daysa. -$150 millionO b. -$60 millionO c.-$250 millionO d. -$575 million

Funding GAP: For each time bucket, the difference between rate-sensitive assets (RSA) and…

Answered: The following are the assets and…

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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A company plans to make four annual deposits of $2,250 each to a special building fund. The fund's assets will be invested in mortgage instruments expected to pay interest at 12% on the fund's balance. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: Determine how much will be accumulated in the fund after four years under each of the following situations: 1. The $2,250 annual deposit are made at the end of each of the four years and interest is compounded annually. 2. The $2,250 annual deposit are made at the beginning of each of the four years and interest is compounded annually. 3. The $2,250 annual deposit are made at the beginning of each of the four years and interest is compounded quarterly. 4. The $2,250 annual deposit are made at the beginning of each of the four years interest is compounded annually, and interest earned is withdrawn at the end of each year. Complete this question by entering…
The following transactions were among those reported by Corfe City's electric utility enterprise fund for Year 1: Cash paid to supplier $ 900,000 Cash received from customer households 2,700,000 Proceeds from the sale of revenue bonds 4,500,000 In the electric utility enterprise fund's statement of cash flows for the year ended December 31, Year 1, what amount should be reported as cash flows from capital and related financing activities? A.) $4,500,000 B.) $5,400,000 C.) $7,200,000 D.) $8,100,000
c.) Bank A has three types of assets: Debenture ($90,000), Mortgage ($75,000), and Loan to the Government ($2000). The bank has Tier 1 capital of $15,000 and Tier 2 capital of $20,000. Calculate Capital adequacy ratio. If the capital adequacy requirement ratio is 8%, does the bank meet the requirement?
The T-account below represents assets and liabilities for a bank. Use the T-account to calculate the bank's loans Loans Bonds Reserves Provide your answer below: million Assets ? $18 million $5 million Liabilities + Net Worth Deposits Net Worth $12 million $13 million
Please show the solution.
On January 1, 20x1, Lawrence Lenders loaned $9.6 million to Wilkins Food Products, Inc. to purchase a frozen food storage facility. Wilkins signed a three-year, 4% installment note to be paid in three equal payments at the end of each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Prepare the following for Lawrence Lenders: 1. Prepare the journal entry for lending the funds on January 1, 20x1. 2. Prepare an amortization schedule for the three-year term of the installment note. 3. Prepare the journal entry for the first installment payment received on December 31, 20x1. 4. Prepare the journal entry for the third installment payment received on December 31, 20x3. Complete this question by entering your answers in the tabs below. Req 2 Saved Req 1 3 and 4 2021 Prepare an amortization schedule for the three-year term of the installment note. (Enter your answers in whole dollars.) Dec. 31 Cash…
A-1
Net Cash Flows and NPVs for different discount rate for projects S and L are given below Net Cash Flows ($) Discount Rate (%) NPVS NPVL Year (t) Project S Project L 0% $800 $1100 0 $(3000) $(3000) 5 554.32 1 1500 400 10 161.33 2 1200 900 15 (90.74) (259.24) 3 800 1300 20 (309.03) (565.97) 4 300 1500 a) Calculate the payback period in years for the Project S and Project L i) Payback for Project S: ii) Payback for Project L: c) Calculate NPVS for 5% and NPVL for 10%. Fill the table i) NPVS at 5%: ii) NPVS at 10%: d) What is the IRR for S? (Write down the equation for IRR and then Use an excel worksheet to calculate IRR Equation: Answer: e) What is the IRR for S? (Write down the equation for IRR and then Use an excel worksheet to calculate IRR Equation: Answer: f) What is the cross-over rate? (Write down the equation for IRR and then Use…
Annual cash inflows from two competing investment projects are given below: Investment A $ 4,000 5,000 6,000 7,000 $ 22,000 Year 1234 The discount rate is 10%. Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using tables. Required: Compute the present value of the cash inflows for each investment. Year 1 2 3 4 $ Investment B $ 7,000 6,000 5,000 4,000 $ 22,000 Present Value of Cash Flows Investment A 0 $ Investment B 0 M ...
The issuance of bonds by a public agency is often the manner by which projects are funded. The two major types of bonds are general obligation bonds and revenue bonds. If a $20 million bond is issued for 10% for 25 years. What annual payment needs to be generated by the bonding agency to fully meet the payoff obligations at the end of 25 years if the bank pays an interest rate of 5%?

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