If people refused to use banks to create checkable deposits, the banking system would not be able to create new money.
Checkable deposits include all accounts on which checks can be drawn. These deposits allow the owner of bank account to write checks to third parties. Also, they are very liquid assets that allow depositors to have an easy access to their funds.
For these reason, checkable deposits generally are important but also one of the lowest-cost source of bank funds, covering a large share of bank liabilities. Thus, banks create money by lending excess reserves to consumers and businesses.
Hence, if people refused to use banks to create checkable deposits, the money multiplier decreases.
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Answer:
State Universities provide degrees which raises the economy output because people have a higher education and they can get better jobs
Explanation:
Answer:
d. is a potential liability that has arisen because of a past event or transaction.
Explanation:
A contingent liability refers to an obligation which arises owing to past events or transactions, whose happening is improbable i.e it may or may not arise in the near future.
If the effect of such a liability can be reasonably estimated, then these should be provided for as a footnote in the financial statements.
An example of a contingent liability would be a legal suit filed against the company, if lost would lead to an obligation for damages which the company may have to pay.
Answer:
Annual deposit= $7,904.78
Explanation:
Giving the following information:
Future Value (FV)= $497,000
Number of periods (n)= 22 years
Intesrest rate (i)= 9% compounded annually
<u>To calculate the annual deposit, we need to use the following formula:</u>
<u></u>
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (497,000*0.09) / [(1.09^22) - 1]
A= $7,904.78