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1. What are the the typical six transactions a bank engages in and how they impact...

1. What are the the typical six transactions a bank engages in and how they impact the excess reserve position of the bank involved.
2. What are the typical items on the Fed’s balance sheet
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Answer #1

Answer

1.Transactions bank engages in.

  • Advancing of loans
  • Acceptance of deposits
  • Cheque payment
  • Foreign Curency exchange
  • Issue of letter of credit
  • Bank Guarantee

Impact on excess reserve poistion

If NPA is more reserves will be reduced.

2. Items in fed's balance sheet

  • Treasury Securities
  • Gold Stocks
  • Treasury Securities
  • Federal Agency Debt Securities
  • Mortgage-Backed Securities
  • Unamortized Premiums on Securities Held Outright
  • Repurchase Agreements
  • Loans
  • Items in Process of Collection
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