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Annette [7]
1 year ago
11

assume a simplified banking system in which all banks are subject to a uniform reserve requirement of 20 percent and checkable d

eposits are the only form of money. a bank that received a new checkable deposit of $10,000 would be able to extend new loans up to a maximum of a. $2,000. b. $8,000. c. $9,000. d. $10,000.
Business
1 answer:
beks73 [17]1 year ago
4 0

Assume a simplified banking system in which all banks are subject to a uniform reserve requirement of 20 percent. a bank that received a new checkable deposit of $10,000 would be able to extend new loans up to a maximum of $8000

<h3>What is the banking system?</h3>

Generally, A collection or network of organizations that work together to provide banking services is known as a banking system.

Commercial, national, and investment banks are the primary components of the most important categories of banking systems. Credit unions are often included in the definition of a banking system as well.

Reserve required = 20%, A commercial bank would retain reserves equal to twenty percent of one hundred thousand dollars, which is two thousand dollars.

Therefore, a commercial bank is unable to utilize the sum of $2000 for the purpose of loan creation.

A commercial bank has a lending capacity of = $10,000 minus $2,000, which is equal to $8000.

As a result, the amount of the loan that might be created is a maximum of $8000.

The appropriate response, therefore, is a. $8,000

Read more about the banking system

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The correct answer is C

Explanation:

Beta of a security is calculated as covariance (Ri,Rm) divided by Variance of the market return. Beta is used for measuring the systematic risk of a security.

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g The current ratio is a.a solvency measure that indicates the margin of safety for bondholders. b.used to evaluate a company's
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b.used to evaluate a company's liquidity and short-term debt paying ability.

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The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year. It tells investors and analysts how a company can maximize the current assets on its balance sheet to satisfy its current debt and other payables.

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A company with a current ratio less than one does not, in many cases, have the capital on hand to meet its short-term obligations if they were all due at once, while a current ratio greater than one indicates the company has the financial resources to remain solvent in the short-term.

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3 years ago
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Scott was denied the loan because he was not old enough to qualify.

<h3>What is the Payday loan?</h3>

Payday loan is a type of unsecured loan in which high rate of the interest is given to the borrower. It is a kind of the short term loan basically for the two weeks.

According to the above situation, Scott is cannot get the payback loan because he is  minor to sanction a loan. He must have the age of 18 years or above.

Learn more about payday loan here:

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_____ gives the property owner an allowance for the decline in the physical condition of real estate over time.
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Depreciation gives the property owner an allowance for the decline in the physical condition of real estate over time., the actual decline in an asset's fair value, such as the annual decline in value of factory equipment due to use and wear, and second, the allocation in accounting statements of the asset's original cost to periods during which the asset is used.

Depreciation in accounting refers to two different aspects of the same idea: first Depreciation is the process of reallocating, or "writing down," the cost of a tangible item (such as equipment) over the course of that asset's useful life.

To learn more about Depreciation, click here.

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If a firm's goal is to maximize its earnings per share, this is the best way to maximize the price of the common stock and thus
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