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Gala2k [10]
3 years ago
15

Banks can protect themselves from the disruption caused by deposit outflows by A. "calling in" loans B. holding excess reserves

C. selling securities D. borrowing from other banks E. borrowing from the Fed F. doing all of the above
Business
1 answer:
Aliun [14]3 years ago
8 0

Answer:

D, doing all of the above

Explanation:

Deposit outflow is a situation in which deposits are lost as a result of continous withdrawals by depositors.

In other for banks to protect themselves from this sort of situation, the bank can choose to do all of the options in the questions which includes callin-in loans, holding excess reserves and/or selling securities. This helps the bank to maintain account balances amongst other things.

To reduce or eradicate deposit outflow is the reason for deposit insurance. Deposit Insurance corporations or companies helps banks to reduce their deficits or losses when they are at the point of not being able to pay deposits when due.

Cheers

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You would like to establish a trust fund that will provide $50,000 a year forever for your heirs. The trust fund is going to be
Finger [1]

Answer:

$1,818,181.81

Explanation:

Data provided:

Amount that will be provided a year = $50,000

Expected rate of return = 2.75%

Now,

The Present value of perpetuity is given as:

Present value of perpetuity = \frac{\textup{Annual return}}{\textup{Expected rate of return}}

on substituting the respective values, we get

Present value of perpetuity = \frac{\textup{50,000}}{\textup{0.0275}}

or

Present value of perpetuity = $1,818,181.81

Hence,

The amount that must be deposited today to fund this gift is $1,818,181.81

5 0
3 years ago
Marsha’s Pet Store employs six employees. Their duties are to sell pets, replenish the stock, keep the pets’ cages clean, feed t
Gemiola [76]

Answer: True.

Explanation:

People sometimes have a tendency of doing only what they are told to do or only what they are paid for. This is why most people who progress in a company do so on the basis of having done work that was not in their description, but would have helped the company progress.

It would appear that Marsha's 6 employees are all of the caliber of employees who just do what they are told and nothing more.

For this reason therefore, she would include a stipulation changing the scheme to include careful performance of the other duties before any sales commission can be earned. This way they'll start to do those other things since they are now paid to do so.

8 0
3 years ago
Your younger sister needs $50 to buy a new bike. She has opened a lemonade stand to make the money she needs. She currently is c
AleksandrR [38]

The correct answer is: "I would recommend her not to increase the price, because with an elastic demand function this will cause a great decrease in the quantity demanded by consumers".

The demand function represents the quantity of a certain good or service that consumers are willing to purchase in the market at different price levels. The law of demand states that there is an inverse relationship between price and quantity demanded (ceteris paribus, hence, given that the rest remains equal). <u>Therefore, when the price charged decreases, the amount that consumers are willing to purchase increases. </u>

In turn, the elasticity of the demand function measures the sensitiveness of the quantity demanded by consumers when there is a certain price change. If the demand function is elastic it means that a price variation would generate an even larger variation (in the inverse direction of course!) in the quantity demanded. <u>This is the case of the lemonade stand therefore the girl should not increase prices because this will not help her to reach her objective quicke</u>r, as she would loss a greater proportion of units sold than the size of the price increase that would have allowed her to earn more per unit.

5 0
2 years ago
Pier is trying to determine which leadership style to use in making a decision that may have a major impact on his company. He’s
oksian1 [2.3K]

Answer:

The answer is: Normative leadership model

Explanation:

The normative leadership model requires Pier to analyze the following seven situations:

  1. How will my decision will affect the organization?
  2. Is it important that team members are committed to the decision making process.?
  3. As a leader, do I possess the knowledge to solve try to solve this issue?
  4. If only I are responsible for making the decision, will the rest of the team be committed to it?
  5. My team members support me and the organization?
  6. The team members possess the knowledge to try to solve this issue?
  7. Can team members unite and really work as a team to solve this issue?

Depending on what Pier believes the correct answers are for the above questions, he can decide to use one of the following decision making processes:

  1. Decide: Pier makes the decision by himself with little or no participation of the team members.  
  2. Consult (Individually): Pier consults the team members individually, deciding what information to use, and then makes a decision by himself.  
  3. Consult (Group): Pier organizes a group meeting where all members express their opinions, then decides what information is useful and makes the decision by himself.  
  4. Facilitate: Pier organizes a group meeting and presents his opinion and every group member participates. The decision is made by group consensus.
  5. Delegate: Pier leaves the decision making process entirely to the group members and doesn't participate in it.
6 0
3 years ago
Brewster's is considering a project with a life of 5 years and an initial cost of $120,000. The discount rate for the project is
PSYCHO15rus [73]

Answer:

Net present value 27.792‬

Explanation:

<u>Sales</u> 2.100 units x 20 net cash flow =<em> $ 42,000 cash flow per year</em>

<u>Present value of the first three years:</u>

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 42,000

time 3 years

discount rate: 0.12

42000 \times \frac{1-(1+0.12)^{-3} }{0.12} = PV\\

PV $100,876.9133

For year 4 and 5 we need to check for the expected cashflow

<u>We will multiply each outcome by their probability:</u>

1,400 units x $20 per unit x 0.5 chance =  14,000

2,500 units x $20 per unit x 0.5 chance = 25,000

expected return:    <em>39,000</em>

<u>present value of these years:</u>

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity  $39,000.0000

time   4 end of year 4th

rate  0.12

\frac{39000}{(1 + 0.12)^{4} } = PV  

PV   24,785.21

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity  $39,000.0000

time   5 end of year 5th

rate  0.12

\frac{39000}{(1 + 0.12)^{5} } = PV  

PV   22,129.65

<u>Net present value</u> will be the present value of the cash flow less the investment.

100,877 + 24,785 + 22,130 - 120,000 = 27.792‬

7 0
3 years ago
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