Question Completion:
Assume that the required reserve ratio is 10%, and that all currency is deposited into the banking system.
Answer:
The money supply would decrease by $2 billion or less.
Explanation:
a) Data and Calculations:
Treasury securities bought by the Fed = $200 million
Required reserve ratio = 10%
Money supply = $200 million/0.10 = $2,000 million
b) When the Fed buys Treasury securities worth $200 from the bank, the money supply in the economy will be increased because the action increases the amount of money available to the bank, which the bank can subsequently lend to borrowers. However, since it is expected to lend only part of the money, the increase in the money supply will not amount to $2 billion. The actual money supply will be less than this amount.
Answer:
The cost of the land should be recorded as $108,350
Explanation:
Land cost = $112,000
Demolition dilapidated building = $2,200
Legal fees - title search = $1,450
Cost of land = Land cost - Demolition dilapidated building - Legal fees - title search
Cost of land = $112,000 - $2,200 - $1,450
Cost of land = $108,350
Answer: The overarching purpose of credit risk analysis is to quantity potential credit losses.
Explanation:
The main purpose of the credit risk analysis is to quantify the amount of credit risk which is presented to the lender by the borrower. Credit risk analysis involves the assigning of measurable numbers to estimated probability of the amount borrowed by the borrower.
Credit risk analysis is a method of analysis that is performed on potential borrowers by a credit analyst to determine their capacity to meet their debt obligations. The main aim of credit analysis is to help determine the creditworthiness of borrowers and to know if they are capable of honoring their debt obligations.
If the borrower is analysed and the credit analyst is okay with the person, the person can be borrowed the amount he asks for as the outcome of the credit risk analysis is used to determine the risk rating assigned to the borrower.
Answer:
The correct answer is (B)
Explanation:
Many shopping stores have product stacked up in bins and they let customers look for the desired product. Usually, these products are on sale and they cost less compared to other products. The cost customers pay on these products include; the price of the product, the time they spent on looking for that specific product and the energy they wasted.
Answer: It provides a set of developmental experiences that managers must complete to be considered for top management positions.
Explanation:
Succession Planning which is also called Replacement Planning helps a company properly plan for the transitioning from the current leaders to Future Leaders when their time comes. In large Corporations it is usually the job of the Top Management including the Board of Directors.
Succession Planning identifies potential replacements whether they are in the company or outside it with the chief difference in treatment being that a potential leader identified inside the company will probably be groomed for it.
Succession Planning lists the criteria for a person to be considered for a top job and these include developmental experiences that a potential leader must have completed to enable them compete for the top job.
Succession planning is very important as it ensures continuity whilst giving employees hope that they will be more successful in a company in future.
