What are the required reserves of peoples national bank

Reference no: EM13455018

Suppose that the reserve requirement is 10 percent and the balance sheet of the People's National Bank looks like the accompanying example.

a. What are the required reserves of People's National Bank? Does the bank have any excess reserves?

b. What is the maximum loan that the bank could extend?

c. Indicate how the bank's balance sheet would be altered if it extended this loan (show the new t-account).

d. Suppose that the required reserves were 20 percent. If this were the case, would the bank be in a position to extend any additional loans? Explain.

Assets	Liabilities
Vault Cash $20,000	Checking deposits $200,000
Deposits at Fed $30,000	Net Worth $15,000
Securities $45,000
Loans $120,000

Reference no: EM13455018

Questions Cloud

Where are the consistencies in treatmentnbsp where are the : write a 1.5-2 page paper comparing the von sivers description of either the incas or the aztecs to the von sivers

Discuss what steps a hospital should take to help ensure : 1 read the case study hospitals duty to ensure competency on pages 183-184 in the textbook.2 write a paper 1250-1500

Despite commonly held beliefs about the popularity of : despite commonly held beliefs about the popularity of presidents presidents are elected by the electoral college.

Three different bird species live in the similar tree one : three different bird species live in the same tree. one feeds at the top of the tree the second feeds in the middle

What are the required reserves of peoples national bank : suppose that the reserve requirement is 10 percent and the balance sheet of the peoples national bank looks like the

Disks of rubbery cartilage are found between the individual : 1. disks of rubbery cartilage are found between the individual bones in the spinal column. what function do you think

Resources the final project overview final project plan and : resources the final project overview final project plan and the final project interview documents.select a religion

Compare the role of the flood in the following myths the : compare the role of the flood in the following myths the dine bahane the epic of gilgamesh and the decent from the sky

Describe how your building was constructed-in terms of : choose any building made before 1500 ce which either remains standing or whose construction and design are well

User Account

All Pages