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AnnZ [28]
3 years ago
6

Suppose that Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is 20 percent. Th

e bank sells $5,000 in securities to the Federal Reserve Bank in its district, receiving a $5,000 increase in reserves in return. Instructions: Enter your answer as a whole number. What level of excess reserves does the bank now have?
Business
1 answer:
podryga [215]3 years ago
8 0

Answer:

$5,000

Explanation:

New total reserve = Existing reserve + Increase in reserve = $20,000 + $5,000 = $25,000

Required reserve still remains at $20,000 because the sale of securities does not change the checkable deposits,

Therefore, we have

Excess reserves = Actual reserve - Required reserve = $25,000 - $20,000 = $5,000 .

Therefore, level of excess reserves the bank now have is $5,000.

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Cindy's apartment complex is offering renters insurance through their insurance company. The insurance company charges an annual
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3 years ago
Dividends paid to a company's own stockholders of $80,000 would be shown on the company's statement of cash flows prepared under
7nadin3 [17]

Answer: d. a deduction of $80,000 under financing activities.

Explanation:

Under the indirect method of showing cashflows, there are 3 sections being the Operating section, the investing section and the financing section.

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6 0
3 years ago
Sixty-second Avenue Inc. expects to earn $5,700,000 this year. The company currently has 790,000 shares outstanding, and the sha
11111nata11111 [884]

Answer:

The company's expected market price per share After the repurchase would $23.68

Explanation:

In order to calculate the company's expected market price per share After the repurchase we would have to calculate first the Price-to-earnings ratio ( P/E ratio ) as follows:

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Therefore, the company's expected market price per share After the repurchase=$ 8.14 x 2.91 = $23.68

7 0
3 years ago
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