Now, suppose that Humongous National loans the amount that you found in part b) to Ronaldinho...
- Now, suppose that Humongous National loans the amount that you found in part b) to Ronaldinho Gaúcho.
Fill out the blanks in the Humongous National Bank’s T-account to reflect this transaction. Show your calculation.
Answer: (4 points)
Humongous National’s T-account:
Assets Liabilities__
TR= $3,080 D = $3.080
RR = $369.60
ER = $2,710.40
- As a result of this transaction, can Humongous National continue loaning out money using Leo Messi’s initial deposit of $3,500?
Answer: (circle the correct answer) (3 points)
YES NO
- Now, suppose that Ronaldinho Gaúcho deposits a loan from Humongous National Bank in the Financial National Bank. The required reserve ratio in this economy is still 12%. Assume that Financial National did not have any previous deposits.
Fill out the blanks in the Financial National Bank’s T-account to reflect this transaction. Show your calculation.
Answer: (4 points)
Financial National’s T-account:
Assets Liabilities__
TR= D =
RR =
ER =
- As a result of Ronaldinho’s transaction, what is the maximum amount (in $) that Financial National can loan out?
Answer:
I completed the top half, need some help on the bottom part with using the numbers.
Homework Answers
- Now, suppose that Humongous National loans the amount that you found in part b) to Ronaldinho Gaúcho.
Fill out the blanks in the Humongous National Bank’s T-account to reflect this transaction. Show your calculation.
Answer:
Humongous National’s T-account:
| ASSETS | Liabilities |
| TR=420 | D=3500 |
| RR=420 | |
| Loan=3080 |
- As a result of this transaction, can Humongous National continue loaning out money using Leo Messi’s initial deposit of $3,500?
Answer: NO
- Now, suppose that Ronaldinho Gaúcho deposits a loan from Humongous National Bank in the Financial National Bank. The required reserve ratio in this economy is still 12%. Assume that Financial National did not have any previous deposits.
Fill out the blanks in the Financial National Bank’s T-account to reflect this transaction.
Show your calculation.
Answer:
Financial National's T-account:
| ASSETS | Liabilities |
| TR=3080 | D=3080 |
| RR=369.6 | |
| ER=2710.4 |
Financial National’s T-account:
- As a result of Ronaldinho’s transaction, what is the maximum amount (in $) that Financial National can loan out?
Answer: 2710.4
Add Answer to:
Now, suppose that Humongous National loans the amount that you
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