Question

Suppose the fed sells $50 million of government securities to the bank of america. complete the sentences. the fed's total assets ______ and its total liabilities ______.

Answer 1

Suppose the fed sells $50 million of government securities to the bank of America. complete the sentences. the fed's total assets increase by​ $50 million and its total liabilities do not​ change.

What are liabilities?

• A liability is defined in financial accounting as the future forfeitures of economic benefits that an entity must make to other entities as a result of previous transactions or other previous events, the resolution of which may result in the transfer or use of assets, the provision of services, or another future yielding of economic benefits.
• Financial accounting liabilities might be based on equitable duties or constructive obligations rather than having to be legally enforceable.
• A responsibility based on moral or ethical principles is referred to as an equitable obligation.
• Contrary to an obligation that is founded on a contract, a constructive duty is one that is suggested by a particular combination of circumstances.

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