1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Tomtit [17]
3 years ago
12

Assume that the required reserve ratio is 5 percent. If a commercial bank has $2 million cash in its vault, $1 million in govern

ment securities, $3 million on deposit at the Fed, and $60 million in checkable deposits, then its excess reserves equal:
(A) 0 million
(B) 2 million
(C) 5 million
(D) 6 million
Business
1 answer:
Stels [109]3 years ago
4 0

Answer:

The correct answer is option B.

Explanation:

The required reserve ratio is 5 percent.

A commercial bank has $2 million cash in its vault, $1 million in government securities, $3 million on deposit at the Fed, and $60 million in checkable deposits.  

The required reserves

= Required\ reserve\ ratio\ \times\ checkable\ deposits

= 0.05\ \times\ \$60 million

= 3 million

The total reserves are the amount in the vault and the deposits at the fed. So, the total reserves are $5 million.  

The excess reserves are

= $5 million - $3 million

= $2 million

You might be interested in
A legal firm would be considered a
Serjik [45]
A legal firm would be considered a service company because they provide legal services to clients and persons.
4 0
3 years ago
Read 2 more answers
The balance in accounts receivable at the beginning of 2016 was $600. During 2016, $3,200 of credit sales were recorded. If the
andreyandreev [35.5K]

Answer:

$3,100

Explanation:

Step 1: Draw up the Accounts Receivable Account

Opening Balance  $600          Allowance for Doubtful debt   $200

Sales                       $3,200       Cash Collected                        $3,100

                                                   Closing Balance                       <u>$500</u>

                                <u>$3,800</u>                                                         <u>$3,800  </u>  

To calculate the cash collected from customers

first, add the debit side of the accounts receivable which is a sum of the opening balance and sales= 3,800

Secondly, add the figures in the credit side including allowance for doubtful debt and closing balance= $700

Thirdly, Subtract the lesser side from the greater, $3,800 - $700 = $3,100

$3,100 was cash collected from the customers in 2016

8 0
3 years ago
Carl has a checking account. He'd like to know right away when his balance gets lower than $50. What should Carl do?
enyata [817]
He should set up an alert.
8 0
3 years ago
Read 2 more answers
How did whirlpool use capabilities of text analytics to better understand their customers and improve product offerings?
77julia77 [94]

Whirpool use the competences to enhanced their understanding of their customers and develop product offerings by as we know that Whirpool Corporation takes a cooperative approach to social media networks, with the Digital Marketing, Public Relations, and Customer Care teams all concerted effort to make available a reliable and trustworthy brand voice to its customers. 

5 0
3 years ago
An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected return of 16% and a standard devi
ElenaW [278]

The proportion of the optimal risky portfolio that should be invested in stock A is 0%.

Using this formula

Stock A optimal risky portfolio=[(Wa-RFR )×SDB²]-[(Wb-RFR)×SDA×SDB×CC] ÷ [(Wa-RFR )×SDB²+(Wb-RFR)SDA²]- [(Wa-RFR +Wb-RFR )×SDA×SDB×CC]

Where:

Stock A Expected Return  (Wa) =16%

Stock A Standard Deviation (SDA)= 18.0%

Stock B Expected Return  (Wb)= 12%

Stock B Standard Deviation(SDB) = 3%  

Correlation Coefficient for Stock A and B (CC) = 0.50  

Risk Free rate of return(RFR) = 10%

Let plug in the formula

Stock A optimal risky portfolio=[(.16-.10)×.03²]-[(.12-.10)×.18×.03×0.50]÷ [(.16-.10 )×.03²+(.12-.10)×.18²]- [(.16-.10 +.12-.10 )×.18×.03×0.50]

Stock A optimal risky portfolio=(0.000054-0.000054)÷(0.000702-0.000216)

Stock A optimal risky portfolio=0÷0.000486×100%

Stock A optimal risky portfolio=0%

Inconclusion the proportion of the optimal risky portfolio that should be invested in stock A is 0%.

Learn more here:

brainly.com/question/21273560

6 0
2 years ago
Other questions:
  • Of 58 bank customers depositing a check, 15 received some cash back. (a) Construct a 90 percent confidence interval for the prop
    15·1 answer
  • The following events occurred for Favata Company: Received $16,000 cash from owners and issued stock to them. Borrowed $13,000 c
    6·1 answer
  • ​Boeing's decision to build​ 80% of its wing flap motors​ in-house is an example of which​ strategy? A. Unrelated diversificatio
    6·1 answer
  • On January 1, 2021, the Allegheny Corporation purchased equipment for $115,000. The estimated service life of the equipment is 1
    7·1 answer
  • Benoit Company produces three products, A, B, and C. Data concerning the three products follow (per unit): Product A B C Selling
    14·1 answer
  • On December 31, 2021, when its Allowance for Doubtful Accounts had a debit balance of $1,534, Indigo Corporation estimates that
    7·1 answer
  • With milk sales sagging of late, The Milk Processor Education Program (MPEP) decided to move on from the famous "Got Milk" ad sl
    7·1 answer
  • What is a risker loan for the lender?
    9·1 answer
  • First, look up a treaty via the Internet or a book, cite your source, and answer the following questions in a report of at least
    9·1 answer
  • EZ-Tax is a tax accounting practice with partners and staff members. Each billable hour of partner time has a $800 budgeted pric
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!