Reference no: EM131337950
Assets Liabilities Cash = $110,000 DD = $2,000,000 rr = 10% Dep at Fed = $90,000 Treasury Bills = $100,000
1. This bank will be able to expand its loan portfolio if
a. Fed raises the rr to 15%
b. Fed sells $50,000 in T-bills to this bank
c. a bank client deposits $20,000 in their account
d. all of the above
e. none of the above
2. Under which of the following scenarios is this bank most likely to participate on the demand side of the federal funding market?
a. Fed sells the bank $50,000 of T-bills
b. Fed purchases $50,000 in T-bills from this bank
c. Fed lowers the reserve ratio to 5%
d. Fed purchases $50,000 in T-bills from a customer of this bank who then deposits the Fed Res check in his/her checking account at the bank
3. If this bank grants any new loans in the amount of $100,000
a. XR is going increase
b. RR is going to increase
c. RR may increase
d. XR may increase
e. none of the above
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