First National BankAssetsLiabilities and Net WorthUS Treasury Bonds$450,000Net Worth$500,000Reserves (Cash)$175,000Checkable Deposits$250,000Loans$125,000Second National BankAssetsLiabilities and Net WorthUS Treasury Bonds$100,000Net Worth$250,000Reserves (Cash)$250,000Checkable Deposits$100,000Third National BankLiabilities and Net WorthAssetsUS Treasury Bonds$900,000Net Worth$1,000,000Reserves (Cash)$350,000Checkable Deposits$500,000Loans$250,000The required reserve ratio is 25% for all banks. SecondNational Bank is capable of loaning $(Do NOTenter the '$' in your response. Enter a whole dollaramount; do NOT enter cents.) to its customers.Blank 1

Net worth is positively related to reserves. It means as reserves rise then net worth fall and as…

The required reserve ratio is 25% for all banks. Second National Bank is capable of loaning $ (Do NOT enter the '$' in your response. Enter a whole dollar amount; do NOT enter cents.) to its customers.

The required reserve ratio is 25% for all banks. Second National Bank is capable of loaning $ (Do NOT enter the '$' in your response. Enter a whole dollar amount; do NOT enter cents.) to its customers.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

First National Bank
Assets
Liabilities and Net Worth
US Treasury Bonds
$450,000
Net Worth
$500,000
Reserves (Cash)
$175,000
Checkable Deposits
$250,000
Loans
$125,000
Second National Bank
Assets
Liabilities and Net Worth
US Treasury Bonds
$100,000
Net Worth
$250,000
Reserves (Cash)
$250,000
Checkable Deposits
$100,000
Third National Bank
Liabilities and Net Worth
Assets
US Treasury Bonds
$900,000
Net Worth
$1,000,000
Reserves (Cash)
$350,000
Checkable Deposits
$500,000
Loans
$250,000
The required reserve ratio is 25% for all banks. Second
National Bank is capable of loaning $
(Do NOT
enter the '$' in your response. Enter a whole dollar
amount; do NOT enter cents.) to its customers.
Blank 1

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