The table below is the balance sheet for all banks combined in the banking system. All banks have a target reserve ratio of 5%.AssetsReservesLoans$160,000 $2,533,250Liabilities/EquityDemand Deposits$3,037,500$Shareholders' equity337,500SecuritiesFixed assetsTotal337,500344,2503,375,000Total3,375,000a. The amount of excess reserves is $b. The maximum amount that loans and deposits could be increased by is $c. Assume that the system becomes fully loaned up. Show the new balance sheet in the table above.d. Now that the system is fully loaned up, the money supply will have Increased by $

c. Assume that the system becomes fully loaned up. Show the new balance sheet in the table…

Answered: The table below is the balance sheet…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The table below is the balance sheet for the Oilers Bank, which has a target reserve ratio of 5%. Liabilities/Equity Demand Deposits Shareholders' equity Assets Reserves Loans Securities Fixed assets Total $3,000 34,000 8,500 4,500 50,000 Total $40,000 10,000 50,000 a. The Oilers Bank is over-reserved by $ b. The bank makes a loan equal to the excess reserves and the borrower writes a cheque (for the full amount of the loan) to another customer of the bank, who then deposits it. The new amount of excess reserves is $ c. Instead, the cheque written by the borrower is cleared against the Oilers Bank (the cheque was written to a customer of another bank). The amount of excess reserves held by the Oilers Bank is $
22. Which of the following entries would appear on the liabilities side of a commercial bank's balance sheet? Government of Canada securities demand deposits cash reserves mortgage loans foreign currency reserves
What is the term for the central banking system of the United States? A. Federal Reserve B. Bank of America C. IMF D. World Bank
Coin Bank has deposits of $350 million. It holds reserves of $30 million and government bonds worth $70 million. If the bank sells its loans at market value of $400 million, what will its total assets equal? $500 million $750 million $450 million $380 million
Please no written by hand Use the information presented in Northeastern Mutual Bank's balance sheet to answer the following questions. Bank’s Balance Sheet Assets Liabilities and Owners' Equity Reserves $150 Deposits $1,200 Loans $600 Debt $200 Securities $750 Capital (owners' equity) $100 Suppose the owners of the bank borrow $100 to supplement their existing reserves. This would increase the reserves account and ? the ? account. This would also bring the leverage ratio from its initial value ? of to a new value of ? . Which of the following do bankers take into account when determining how to allocate their assets? Check all that apply. The total value of liabilities The riskiness of each asset The size of the monetary base
11
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List the objectives that banks have for buying securities. Explain the motive for each.
Complete the table below for the Third National Bank. Classify the assets and liabilities and net worth. What is the total assets of Third National Bank? Assets Liabilities and Net Worth Stock Shares $ 420 ____ ____ Reserves 25 ____ ____ Property 300 ____ ____ Securities 100 ____ ____ Loans 100 ____ _____ Demand Deposits 105 ____ ____
The balance sheet of Nationa Bank is shown below (assume a legal reserve ratio of 10%): Assets Liabilities & Net Worth Reserves 90,000 Checkable Deposits 500,000 Cash 20,000 Stock Shares 270,000 Loans 125,000 Securities 235,000 Property 300,000 1. Based on the balance sheet above, how much money can the bank create? 2. If the bank creates the full amount possible, how much money can the banking system create as a result? 3. If the Federal Reserve raises the reserve ratio to 20%, how much will the bank and banking system be able to create based on the new reserve ratio?
Use the following balance sheet for the ABC National Bank in answering the next question(s). Assume the required reserve ratio is 20 percent. Assets Liabilities and net worth Reserves$27,000 Checkable deposits$110,000 Loans50,000 Capital stock200,000 Securities33,000 Property200,000

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