Question

1. Which of the following assets is the most liquid? Dollars. Money market mutual fund shares....

1. Which of the following assets is the most liquid?
Dollars.
Money market mutual fund shares.
Passbook savings deposits.
Bonds.
Certificates of deposit.

2.Sumit deposits $1,500 cash into his checking account. The reserve requirement is 25%. How much money can the banking system create?
$0
$1,500
$6,000
$1,125

3. If Abigail withdraws $300 cash from her checking account, her bank's assets then:
do not change but liabilities fall by $300.
fall by $300 but liabilities do not change.
fall by $300 and liabilities rise by $300.
fall by $300 and liabilities fall by $300.
Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Which of the following assets is the most liquid?    Certificates of deposit.     Dollars.    ...
Which of the following assets is the most liquid?    Certificates of deposit.     Dollars.     Bonds.     Passbook savings deposits.     Money market mutual fund shares.
The Aqua Liquid Assets Money Market Mutual Fund has a NAV of $1 per share. During...
The Aqua Liquid Assets Money Market Mutual Fund has a NAV of $1 per share. During the year, the assets held by this fund appreciated by 1.7 percent. If you had invested $25,000 in this fund at the start of the year, how many shares would you own at the end of the year? WHat will the NAV of this fund be at the end of the year? Why?
1. Which is MOST liquid? a. a mortgage loan b. checkable deposits in a bank c....
1. Which is MOST liquid? a. a mortgage loan b. checkable deposits in a bank c. a new truck d. a diamond 2. An illiquid bank is one that: a. borrows in the market for federal funds. b. borrows at the discount window. c. has more short-term liabilities than short-term assets. d. has more long-term assets than liabilities. 3. As the reserve ratio rises: a. a bank's opportunity cost of holding reserves rises. b. the interest rate on money will...
3. Erin has the following liquid assets on deposits with her bank, which is an FDIC-insured...
3. Erin has the following liquid assets on deposits with her bank, which is an FDIC-insured institution. Account Ownership Balance CD Erin $200,000 Savings Erin with spouse $50,000 IRA (money market deposit account) Erin $75,000 Checking account Erin $90,000 What is the total amount currently insured by the FDIC?
12 .Which one of these assets is the MOST liquid one? Select one: a. Land b....
12 .Which one of these assets is the MOST liquid one? Select one: a. Land b. A corporate bond 13. Justin pays for his groceries using a debit card. Justin is using money as: Select one: a. A medium of arbitration b. A medium of exchange c. A unit of account d. A store of value e. A unit of transaction c. A stock in a small, risky company d. A vehicle 14. Emma, a high school student, lives with...
8. The reserve requirement, open market operations, and the money supply Assume that banks do not...
8. The reserve requirement, open market operations, and the money supply Assume that banks do not hold excess reserves and that households do not hold currency, so the only form of money is demand deposits. To simplify the analysis, suppose the banking system has total reserves of $300. Determine the money multiplier and the money supply for each reserve requirement listed in the following table. Reserve Requirement        Simple Money Multiplier                Money Supply ($$)       (Percent)           5   (0.5,...
An open market sale is: A. The Fed buys Treasury securities from banks, causing the money...
An open market sale is: A. The Fed buys Treasury securities from banks, causing the money supply to rise. B. The Fed buys Treasury securities from banks, causing the money supply to fall. C. Banks buy Treasury securities from the Fed, causing the money supply to rise. D. Banks buy Treasury securities from the Fed, causing the money supply to fall. When you go to a store, you assume the seller will accept your cash because US dollars: A. are...
4. The money creation process Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity...
4. The money creation process Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserve ratio is 10%. The Federal Reserve buys a government bond worth $250,000 from Sean, a customer of First Main Street Bank. He deposits the money into his checking account at First Main Street Bank. Complete the following table to reflect any changes in First Main Street Bank's balance sheet (before the bank makes any new...
7. The money creation process Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity...
7. The money creation process Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserve ratio is 10%. Hubert, a client of First Main Street Bank, deposits $250,000 into his checking account at First Main Street Bank. Complete the following table to reflect any changes in First Main Street Bank's T-account (before the bank makes any new loans). Assets Liabilities             Complete the following table to show...
The bank balance sheet below lists the categories of assets and liabilities, along with the total...
The bank balance sheet below lists the categories of assets and liabilities, along with the total amount of each category, and the amount in each category that is "interest rate sensitive" or repriced within one year. Calculate the existing Dollar Gap for the bank. Next, calculate the effect (change) on this bank's Net Interest Income if interest rates fall or decrease by 1 percentage point or 100 bp. "%" denotes either the current interest rate earned earned or paid on...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT