Reference no: EM13827837
Problem:
The following demand deposits and cash reserves at the Fed have been documented by a bank for the computation of reserve requirements (in millions). Reserves are vault cash and reserves at the Fed.
|
|
Monday
|
Tuesday
|
Wednesday
|
Thursday
|
Friday
|
|
|
6/12
|
6/13
|
6/14
|
6/15
|
6/16
|
|
D.Deposits
|
$300
|
$320
|
$280
|
$290
|
$270
|
|
Reserves
|
$28
|
$29
|
$29
|
$17
|
$18
|
|
|
6/19
|
6/20
|
6/21
|
6/22
|
6/23
|
|
D.Deposits
|
$310
|
$305
|
$320
|
$340
|
$310
|
|
Reserves
|
$31
|
$29
|
$28
|
$29
|
$15
|
|
|
6/26
|
6/27
|
6/28
|
6/29
|
6/30
|
|
D.Deposits
|
$240
|
$230
|
$250
|
$260
|
$270
|
|
Reserves
|
$19
|
$19
|
$21
|
$19
|
$24
|
|
|
7/3
|
7/4
|
7/5
|
7/6
|
7/7
|
|
D.Deposits
|
$300
|
$320
|
$280
|
$290
|
$270
|
|
Reserves
|
$27
|
$26
|
$27
|
$24
|
$22
|
|
|
7/10
|
7/11
|
7/12
|
7/13
|
7/14
|
|
D.Deposits
|
$310
|
$305
|
$320
|
$340
|
$310
|
|
Reserves
|
$21
|
$21
|
$20
|
$17
|
$18
|
|
|
7/17
|
7/18
|
7/19
|
7/20
|
7/21
|
|
D.Deposits
|
$240
|
$230
|
$250
|
$260
|
$270
|
|
Reserves
|
$31
|
$29
|
$28
|
$29
|
$15
|
|
|
7/24
|
7/25
|
7/26
|
7/27
|
7/28
|
|
D.Deposits
|
$300
|
$320
|
$280
|
$290
|
$270
|
|
Reserves
|
$19
|
$19
|
$21
|
$19
|
$24
|
|
|
7/31
|
8/1
|
8/2
|
8/3
|
8/4
|
|
D.Deposits
|
$310
|
$305
|
$320
|
$340
|
$310
|
|
Reserves
|
$23
|
$22
|
$24
|
$22
|
$23
|
1. What are the average daily demand deposit balances over the reserve computation period beginning the week of June 12?
a. $286 million.
b. $296 million.
c. $306 million.
d. $326 million.
e. $352 million.
2. What is the average daily reserve required to be held by the bank for their demand deposits during the maintenance period? Suppose that the rules require no reserves for the first $5.5 million, 3 percent for amounts between $5.5 million and $42.8 million, and 10 percent thereafter.
a. $26.44 million.
b. $28.86 million.
c. $29.55 million.
d. $31.56 million.
e. $32.06 million.
3. Is the bank in compliance with the requirements?
a. No, it does not meet the minimum reserve requirements.
b. Yes, it meets the minimum reserve requirements.
c. Yes, it meets the minimum requirement only after using the 2 percent carryover allowance.
d. Yes, it meets the minimum requirement only after using the 4 percent carryover allowance.
e. No, it does not meet the minimum reserve requirements even after using the 4 percent carryover allowance.
Additional Information:
This question is from Finance and it is about computation of average daily demand deposits balances, average daily reserve required as well as the bank's compliance with the requirements. These are to be computed in accordance with the demand deposits as well as cash reserves at Fed.
|
Preparing a frequency distribution using five classes
: This problem related to Basic Statistics and it discuss about preparing a frequency distribution using five classes with upper class limit of the first class as the lower class limit of the second. This has been given in the solution
|
|
Knowledge integration exam
: Discussion of these issues on the theories and principles in the reading you have done throughout this seminar. This is not a research project. The purpose of the assignment is to demonstrate your knowledge of and ability to apply the principles and ..
|
|
Beijing olympics chinese government hiring western pr firms
: Beijing Olympics Chinese Government Hiring Western Pr Firms
|
|
Application of sampling methods
: The problem related to Basic Statistics and it discuss about giving an example on one of the application of sampling methods and how the sample is statistically important in allowing in taking decisions on the entire population
|
|
Computation of average daily demand deposits balances
: What is the average daily reserve required to be held by the bank for their demand deposits during the maintenance period? Suppose that the rules require no reserves for the first $5.5 million, 3 percent for amounts between $5.5 million and $42.8 ..
|
|
Discuss the hedging uses of swaps
: Discuss the hedging uses of swaps. How would a person or company benefit from the use of swaps? Provide illustrations in today's economy of different persons or companies using swaps to hedge risks in the marketplace. What can go wrong when using swa..
|
|
Describe soft-skills and hard-skills
: 1. Describe soft-skills and hard-skills. Give an example of each. Why do people need soft skills in an era of high technology? APA Guidelines are to be used for your in-text citations and sources.
|
|
Discuss how statistics can be misused or misleading
: This question relates to Basic Statistics and it discuss about how the subject of statistics and its application can be misleading or can be misused. This has been explained with examples
|
|
What is the average implicit interest rate
: What is the average implicit interest rate on a $100,000 account if the bank's average management costs are $2,500 and annual fees average $1,750?
|