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What is Bank A's ROA based on Figure 1 Balance Sheet ($ in Millions): Assets   Liability and Equity   Cash $850 Deposits $6,475 Securities 1,925 Other borrowing 1,645 Loans 5,400 Equity 1,030 Other 975     Total $9,150 Total $9,150     Figure 2 Income Statement ($ in Millions): Interest income on loans $450 Interest income on securities 95 Interest expense 246 Noninterest income 78 Noninterest expense 112 Provision for loan loss 35 Taxes 115 Net Income $115   Based on Figures 1 and 2, what is Bank A's Equity Multiplier?   A. 8.88   B. 4.75   C. 7.23   D. 8.11

What is Bank A's ROA based on Figure 1 Balance Sheet ($ in Millions): Assets   Liability and Equity   Cash $850 Deposits $6,475 Securities 1,925 Other borrowing 1,645 Loans 5,400 Equity 1,030 Other 975     Total $9,150 Total $9,150     Figure 2 Income Statement ($ in Millions): Interest income on loans $450 Interest income on securities 95 Interest expense 246 Noninterest income 78 Noninterest expense 112 Provision for loan loss 35 Taxes 115 Net Income $115   Based on Figures 1 and 2, what is Bank A's Equity Multiplier?   A. 8.88   B. 4.75   C. 7.23   D. 8.11

Essentials Of Investments
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
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  1. What is Bank A's ROA based on Figure 1 Balance Sheet ($ in Millions):

    Assets   Liability and Equity  
    Cash $850 Deposits $6,475
    Securities 1,925 Other borrowing 1,645
    Loans 5,400 Equity 1,030
    Other 975    
    Total $9,150 Total $9,150

     

     

    Figure 2 Income Statement ($ in Millions):

    Interest income on loans $450
    Interest income on securities 95
    Interest expense 246
    Noninterest income 78
    Noninterest expense 112
    Provision for loan loss 35
    Taxes 115
    Net Income $115

     

    1. Based on Figures 1 and 2, what is Bank A's Equity Multiplier?

        A.

      8.88
        B.

      4.75
        C.

      7.23
        D.

      8.11
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