Chapter 1, Problem 9PS

A

Summary Introduction

To calculate: The ratio of the real asset to total asset is to be determined.

Introduction: The physical assets are called as real assets which include precious metals, lands, commodities and natural resources.

Total assets can be defined by the total amount of asset owned by an individual or any person. These assets are represented in terms of economical value.

Answer to Problem 9PS

The ratio of the real asset to total asset is 0.12.

Explanation of Solution

The balance sheet is given as -

Assets	$Billion	%Total	Liabilities and Net worth	$Billion	%Total
Real assets			Liabilities
Equipment and software	$4259	13.9%	Bonds and mortgages	5935	19.36%
Real estate	$9051	29.5%	Bank loans	612	2.00%
Inventories	$2010	6.6%	Other loans	1105	3.61%
Total real estates	$15320	50.0%	Trade debt	1969	6.42%
			Other	4267	13.92%
Financial asset			Total liabilities	13,888	45.31%
Deposit and cash	967	3.2%
Marketable securities	769	2.5%
Trade and consumer credits	2555	8.3%
Direct investment abroad	4055	13.2%
Other	6983	22.6%
Total financial asset	15329	50.0%	Net worth	16761	54.69%
Total	30649	100.0%		30649	100.00%

The ratio of the real asset to total asset is given as −

  $ratio=\frac{realassets}{totalassets}$

Put the given values in formula.

  $ratio=\frac{\text{\$166}\text{.1 }}{\$13,926.0}=0.12$

B

Summary Introduction

To calculate: The ratio of the real asset to total asset for non-financial firm is to be determined.

Introduction:

The physical assets are called as real assets which include precious metals, lands, commodities and natural resources.

Total assets can be defined by the total amount of asset owned by an individual or any person. These assets are represented in terms of economical value.

Answer to Problem 9PS

The ratio of the real asset to total asset for nonfinancial firm is 0.50.

Explanation of Solution

The balance sheet is given as -

Assets	$Billion	%Total	Liabilities and Net worth	$Billion	%Total
Real assets			Liabilities
Equipment and software	$4259	13.9%	Bonds and mortgages	5935	19.36%
Real estate	$9051	29.5%	Bank loans	612	2.00%
Inventories	$2010	6.6%	Other loans	1105	3.61%
Total real estates	$15320	50.0%	Trade debt	1969	6.42%
			Other	4267	13.92%
Financial asset			Total liabilities	13,888	45.31%
Deposit and cash	967	3.2%
Marketable securities	769	2.5%
Trade and consumer credits	2555	8.3%
Direct investment abroad	4055	13.2%
Other	6983	22.6%
Total financial asset	15329	50.0%	Net worth	16761	54.69%
Total	30649	100.0%		30649	100.00%

The ratio of the real asset to total asset is given as −

  $ratio=\frac{realassets}{totalassets}$

Put the given values in formula.

  $ratio=\frac{\text{\$15,320 }}{\$30,649}=0.50$

C

Summary Introduction

To calculate: The reason for the difference is to be found.

Introduction: The physical assets are called as real assets which include precious metals, lands, commodities and natural resources.

Total assets can be defined by the total amount of asset owned by an individual or any person. These assets are represented in terms of economical value.

Answer to Problem 9PS

Loans are issued by the commercial banks which results in the lower real estate and high financial issue. Therefore, ratio of commercial bank is less than the non-financial firms.

Explanation of Solution

The value of the ratio of the real asset to total asset of commercial bank is less than the ratio of the real asset to total asset for nonfinancial firm. Loans are issued by the commercial banks which results in the lower real estate and high financial issue. Therefore, there is difference between ratio of the commercial bank and the non-financial firms.