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zepelin [54]
3 years ago
9

Suppose a commercial banking system has $40,000 of outstanding checkable deposits and actual reserves of $4,500. If the reserve

ratio is 10 percent, the banking system can expand the supply of money by the maximum amount of
Business
1 answer:
ludmilkaskok [199]3 years ago
3 0

Answer: $50000

Explanation:

Based on the information that's been given in the question, firstly we need to calculate the excess reserves which will be:

= $4500 - (10% × $40000)

= $4500 - $4000

= $500

Then, the money supply that's expanded will be:

= Excess reserve / Reserve ratio

= $5000 / 10%

= $5000 / 0.1

= $50000

Therefore, the answer is $50,000.

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Match each of the following characteristics or scenarios with either the term negative externality or the term positive external
lawyer [7]

<u>Answer:</u> a. Negative externality  

b.Positive externality  

c.Positive externality  

d.Positive externality  

e.Negative externality

<u>Explanation:</u>

Positive externatility are the advantages which the people enjoy apart from the marketplace for which they do not pay any money. Negative externality means negative consequences faced by the people outside due to the activities of the firm.

A.In the scenarios given above when resource are over allocated the public resources are depleted and creates negative externality  .

B. Tammy's case by raising garden increases the value of the public property which is positive externality.

C.Market demand is low so prices are low it is positive externality..

D.When resource are under allocated the public resources are not depleted and creates positive externality  .

E. Water pollution affects public and creates negative externality  . .

3 0
3 years ago
In a credit application, besides one's capacity to pay, creditors also consider which of the following?
DochEvi [55]

Answer:

The lenders use a system of five Cs to know about the creditworthiness of potential borrowers. They weigh five characteristics of the borrower and various conditions of the loan, chances of default and risk of loss. The five Cs used by the lender are capacity, character, collateral, capacity and conditions.

  • The first C is character, it can be known by the previous loans of the applicant.
  • Debt to income ratio is the second C.
  • The third C is capital, it is the amount of money possessed by an applicant.
  • Collateral is the fourth C, it is the asset that can be used to back the loan.
  • The fifth C is conditions, the amount of the loan, its purpose and the prevailing interest rate in the market are known as conditions.
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2 years ago
Taylor Company began manufacturing operations on January 2, 20X1. During 20X1 Taylor reported pre-tax book income of $150,000 an
aleksley [76]

Answer:

$11,300

Explanation:

The computation of the deferred tax asset is shown below:

= 21%(20X2 Expense) + 25%(20X3 and 20X4 Expense)

= 21%($30,000) + 25%($15,000) + 25%($5,000)

= $6,300 + $3,750 + $1,250

= $11,300

3 0
3 years ago
George Bailey purchased equipment from M. Potter for $450,000, paying $35,000 cash as a down payment and financing the remainder
Lorico [155]

Answer:

Equipment $450,000 (debit)

Cash $35,000 (credit)

Suppliers Loan $415,000 (credit)

Explanation:

George Bailey must recognize the Asset of Equipment, de-recognize the Assets of Cash and recognize the Suppliers Loan as above.

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