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Delicious77 [7]
3 years ago
9

Assuming the required-reserve ratio is 20%, after a $5 billion purchase of securities (government bonds) from the non-bank publi

c by the Fed, if all banks make loans until excess reserves equal zero and there are no cash leakages, checkable deposits can expand as a result of new lending by a maximum of _____.
Business
1 answer:
9966 [12]3 years ago
8 0

Answer: $25 billion

Explanation:

The increase in cash as a result of a deposit into the banking system, no cash leakages and a required-reserve ratio is:

= Deposit into banking system * Money multiplier

Money multiplier = 1 / Required reserve ratio

= 1 / 20%

= 5

Checkable deposit increase:

= 5 billion * 5

= $25 billion

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4 years ago
The business earns $700 of consulting revenue. how would these earnings affect the total equity of a business?
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Answer: An increase in revenue will be an increase in equity.

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2 years ago
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4 years ago
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Bryant Company has a factory machine with a book value of $90,000 and a remaining useful life of 5 years. It can be sold for $30
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The old factory machine should be replaced will result in lower cost

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In file.

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7 0
3 years ago
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Jose gross weekly salary as a logger is $630. He pays 6.2% Social Security tax, 1.45% Medicare tax, and $14.20 for health insura
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Answer:

$568

Explanation:

Gross salary = $630

Social security tax = 6.2%

Medicare tax = 1.4%

Health insurance = $14.20

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= 6.2 + 1.4 = 7.6%

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So he pays tax of 47.88 dollars from his gross salary

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= $567.92

this is approximately $568

thank you!

5 0
3 years ago
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