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
Likurg_2 [28]
3 years ago
6

The Capital Purchase Program carried out under TARP represented an attempt by the federal government to increase the capital of

banks. Why would the federal government consider it important to increase bank​ capital? A. To keep banks with falling asset values solvent. B. To keep attracting new clients. C. To raise​ banks' profits. D. To keep inflation low. What might be some of the consequences of banks having insufficient​ capital? A. High profits. B. Insolvency.   C. Low profits. D. A wide range of clients.
Business
1 answer:
4vir4ik [10]3 years ago
7 0

Answer:

A. To keep banks with falling asset values solvent.

Explanation:

When a bank is failing it will result in loss of funds not only for the bank but also for customers that have accounts in these banks.

If a bank eventually closes operations as a result of insolvency, they will not be able to pay off the customers. That is where the deposit insurance comes in to settle customers.

The government will have to spend a lot of money reimbursing customers their money.

To avoid this the federal government ensures the capital of banks is maintained to keep banks with falling asset values solvent.

You might be interested in
Consumer​ surplus:
elena-14-01-66 [18.8K]

Consumer surplus is the difference between the maximum amount the consumer is willing to pay for the price of the good and the price that was actually paid by the consumer or commonly known as the current market price. The price that the consumer is willing to pay is determined by the demand curve in the market.

8 0
3 years ago
Read 2 more answers
Standahl Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports.
VikaD [51]

Answer:

$281,612

Explanation:

Plane Operating Cost = Fixed cost + (Variable cost per unit1 × q1) + (Variable cost per unit 2 × q2)

Plane Operating Cost = $40,190 + ($2709*88) + ($10 * 303)

Plane Operating Cost = $40,190 + $238,392 + $3,030

Plane Operating Cost = $281,612

So, the plane operating costs in the planning budget for August would be $281,612

6 0
2 years ago
Value added per employee is a financial measure of how much product was sold vs. how many employees worked during the
Snowcat [4.5K]
This statement is true !!
7 0
2 years ago
Corner Market Inc. is a supermarket chain. Due to strong competition from other stores in the industry, Corner Market has aggres
Brut [27]

Answer:

The correct answer is a monopolistic competition.

Explanation:

Monopolistic competition is a form of market in which there are a large number of buyers and sellers. The sellers are providing differentiated products which are close substitutes.

There is a high degree of competition in the market. The entry and exit in the market are relatively easier than a monopoly market.

To increase their market share and earn more profits, the firms take the help of branding and advertising.

In the given example, the supermarket chain is operating in monopolistic competition as it has to face a high degree of competition and is using branding, etc to create a niche for itself.

4 0
2 years ago
Galvatron Metals has a bond outstanding with a coupon rate of 6.1 percent and semiannual payments. The bond currently sells for
Eva8 [605]

Answer:

After tax cost of debt is 4.16%

Explanation:

The yield on the debt which is pre-tax cost of debt can be computed using the rate formula in excel, which is given as follows:

=rate(nper,pmt,-pv,fv)

where nper is the number of coupon payments,this is calculated as 19*2 since it has a semi-annual coupon interest

pmt is the periodic coupon payment  6.1%/2*$2000=$61

pv is the current price of the bond which is $1933

fv is the face value repayable on redemption $2000

=rate(38,61,-1933,2000)

=3.20%

This is semi-annual yield , annual yield is 3.20%*2=6.40%

After tax cost of debt=6.40%*(1-t)

where t is the tax rate at 35%=0.35

after tax cost of debt=6.40%*(1-0.35)

                                  =4.16%

5 0
3 years ago
Other questions:
  • The decentralized commercial and office districts that have emerged on the fringes of metropolitan areas near such features as f
    11·1 answer
  • Mila is at a flea market.
    8·2 answers
  • How much interest, if any, can jaxon deduct in year 0 if his business uses the cash method of accounting for tax purposes?
    7·1 answer
  • On December 31, 2020, Vitners Company had outstanding 400,000 shares of common stock and 40,000 shares of 8% cumulative preferre
    14·1 answer
  • ​Aidan, Bianca, Caitlyn and Dmitri want jobs as management consultants. XY Corporation is a management consulting firm in a perf
    14·1 answer
  • A business has been using a notebook to track sales and count how many pieces of each item it has in stock. As a business analys
    9·2 answers
  • Capital Radio PLC, the United Kingdom's biggest commercial radio firm announced in 2002 that it would cooperate with Walt Disney
    15·1 answer
  • No formal steps are necessary to create a sole proprietorship. True or false?
    6·1 answer
  • The journal entry for an installment note payment includes all except:__________.
    7·1 answer
  • A _____ is limited to a select group of suppliers who provide critical high value items to the firm.
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!