Excess reserves = Total reserves - Required reserve
Total reserves = 118,500
Required reserves = 20% * checkable deposit
= 20% * 138000 = 27,600
Excess reserves = 118,500 - 27,600
= $90,900
The bank invests 60% of its excess reserves in securities
Securities = 60% * 90900
= $54540
$54540 worth of securities are bought by the bank
Remaining reserves = 118,000 - 54,540 = 63960
Assets | Liabilities and net worth | ||
Reserves | 63960 | Checkable deposits | 138000 |
Loans | 29500 | Stock shares | 305000 |
Securities | 54540 | ||
Property | 295000 |
refer to the diagrams, in which Ad1 and as1 are the “before 5 Homework Seved Help...
The balance sheet for ACME Bank is shown below. ACME Bank Balance Sheet 1 Assets Liabilities and net worth Reserves $ 107,500 Checkable $ 120,000 deposits Loans $ 28,500 Stock shares $ 290,000 Property $ 274,000 Suppose the bank decides to invest 40 percent of its excess reserves in short-term securities in order to earn interest. The bank issues a cashier's check to a securities dealer to purchase the securities. The securities dealer deposits the check into an account at...
The balance sheet for ACME Bank is shown below. ACME Bank Balance Sheet 1 Assets Liabilities and net worth Checkable deposits $ Reserves 69,500 97,000 $ 42,500 Stock shares $ Loans 220,000 $ 205,000 Property Suppose the bank decides to invest 80 percent of its excess reserves in short-term securities in order to earn interest. The bank issues a cashier's check to a securities dealer to purchase the securities. The securities dealer deposits the check into an account at a...
The balance sheet for ACME Bank is shown below.ACME Bank Balance Sheet 1 Reserves - $64,000Loans - $50,000Property - $299,000Checkable Deposits - $108,000Stock Shares - $305,000Suppose the bank decides to invest 40 percent of its excess reserves in short-term securities in order to earn interest. The bank issues a cashier's check to a securities dealer to purchase the securities. The securities dealer deposits the check into an account at a different bank. What will ACME Bank's balance sheet look like after the...
The balance sheet for the newly formed Last National Bank is shown below. The reserves listed on the balance sheet are reserves on deposit at the Federal Reserve. The cash is vault cash held at the bank. Last National Bank Balance Sheet 1 Liabilities and net worth Assets Cash $ 8,000 Checkable $ 138,000 $ deposits 140,000 Stock shares 295,000 $ Reserves Property 305,000 $ Instructions: Enter your answers as whole numbers. a. Suppose a depositor at the bank writes...
The balance sheet for the newly formed ACME Bank is shown below. The reserves listed on the balance sheet are reserves on deposit at the Federal Reserve. The cash is the vault cash held in the bank. Instructions: Enter your answers as whole numbers. a. Fill in the missing value in the balance sheet.ACME Bank Balance SheetAssets Cash - $12,000Reserves - $150,000Property - ?Liabilities and Net WorthCheckable deposits - $140,000Shock Shares - $240,000b. If the reserve requirement is 12 percent, how much in excess reserves is the...
The balance sheet for the newly formed ACME Bank is shown below. The reserves listed on the balance sheet are reserves on deposit at the Federal Reserve. The cash is the vault cash held in the bank. Instructions: Enter your answers as whole numbers. a. Fill in the missing value in the balance sheet. ACME Bank Balance Sheet Assets Liabilities and not worth Cash Checkable 22.000 $ 106,000 deposits Reserves 88000 Stock shares S 255,000 Property $ $ b. If...
the balance sheet for the newly formed amce bank is shown below. Help Chapter 15 Homework The balance sheet for the newly formed Last National Bank is shown below. The reserves listed on the balance sheet are reserves on deposit at the Federal Reserve. The cash is vault cash held at the bank. Assets Cash $ Last National Bank Balance Sheet 1 Liabilities and net worth 19,000 Checkable 115,000 deposits $ 5 08.000 Stock shares $ 280,000 $ 278,000 Reserves...
Assets Cash Last National Bank Balance Sheet 1 Liabilities and net worth Checkable $ 19.000 $ 115,000 deposits $ 98,000 Stock shares 280,000 $ 278,000 S Reserves Property Instructions: Enter your answers as whole numbers. a. Suppose a depositor at the bank writes a check for $25,000 to a contractor to pay for some remodeling work done on her home. The contractor deposits the check in his bank (which is a different bank). What will last National Bank's balance sheet...
flew by SAT 1 In the following bank balance sheet, amounts are in millions of dollars. The required reserve ratio is 4% on the first $30 million of checkable deposits and 14% on any checkable deposits over $30 million. Assets Liabilities Reserves $26.5 Checkable deposits $180.0 Loans $150 Net worth $20.0 Securities $23.5 Total $200 Total $200 a. Calculate the bank's excess reserves. Excess reserves are 5 million (Enter your response rounded to one decimal place.) b. Suppose that the...
Assets Liabilities + Net Worth Reserves $120,000 Checkable Deposits $300,000 Loans 140,000 Stock Shares 200,000 Securities 40,000 Property 200,000 The accompanying balance sheet is for the First Federal Bank. Assume the required reserve ratio is 20 percent. If the original bank balance sheet was for the whole commercial banking system rather than a single bank, loans and deposits could have been expanded by a maximum of: $40,000. $100,000. $200,000. $300,000.