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devlian [24]
3 years ago
15

The bank you own has the following balance sheet: Assets Liabilities Reserves $75 million Deposits $500 million Loans $525 milli

on Bank capital $100 million If the bank suffers a deposit outflow of $50 million with a required reserve ratio on deposits of 10%, what actions should you take
Business
1 answer:
aliya0001 [1]3 years ago
5 0

Answer:

Explanation:

Calculation of the amount of required reserve as follows:

Required Reserve = Deposit * required reserve ratio

= $500 million * 10%  

= $50 million  

Therefore, the bank must hold $50 million in required reserve.

It currently has $75 million in reserve so this requirement is met.

If the bank suffers a deposit outflow of $50 million

         Assets                                 Liabilities

Reserves - $25 million      Deposits - $450 million

Loans - $525 million         Bank capital - $100 million

So the required reserve is $450 * 10/100 = $45 million.

But in the reserve account we have only 25 million so we are falling short of $20 million. We need to maintain this required reserve so we can take following actions:  1. By borrowing $20 millions from other bank or financial institutions or corporations.  2. We can sell securities of $20 million.  3. We can borrow some money and can raise some money by issuing securities.

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Altoona Corporation has two divisions, Hinges and Doors, which are both organized as profit centers. The Hinge Division produces
Luden [163]

Answer:

Minimum transfer price = $21

Explanation:

<em>Transfer price is the price at which goods are exchange between branches or divisions of the same group</em>

<em>Where  a division is operating at the less than the existing capacity, to optimist the group profit, the minimum transfer price should be set as follows</em>

Minimum transfer price = Variable cost

Note that the fixed of $12 per unit (i.e 33-21) is irrelevant for this purpose, whether or not Hinges produces, it will be incurred either way.

It is worthy of note that there is no opportunity cost associated with any transfer to the Doors division because Hinges is currently having excess capacity.

Therefore, any offering price equal to or above the variable cost of $21 would be acceptable and optimize the group profit.

Hence, the minimum transfer price = $21

3 0
3 years ago
Adelene, who lives in a winter resort area, rented her personal residence for 14 days while she was visiting Brussels. Rent inco
frez [133]

Answer:

a) The effect the rental activity has on Adelene's AGI is $0.                          

b) The total rental income is less than the total expenses for the year, so the reportable rental income is $0.

Explanation:

a)

particulars                                      amount                  amount

rental income                                                                $5,000

property taxes                               $3,800

mortgage interest                          $7,500

utilities                                             $3,700

insurance                                         $2,500

repairs                                              $2,100

depreciation                                     $15,000

total deduction                                                    $34,600

AGI                                                                           $0

Therefore, The effect the rental activity has on Adelene's AGI is $0.                          

b)

particulars                                      amount

Real property taxes                       $3,800

mortgage interest                          $7,500

utilities                                             $3,700

insurance                                         $2,500

repairs                                              $2,100

depreciation                                     $15,000

total expenses                                  $34,600

Therefore, The total rental income is less than the total expenses for the year, so the reportable rental income is $0.

7 0
3 years ago
"I'll let you sell the Harley-Davidson designer clothes only if you'll also sell a new line of clothes designed by Paula Abdul,
yulyashka [42]

Answer:

B)tie-in sales.

Explanation:

Theses are the options for the question;

A. misrepresentation.

B. tie-in sales.

C. reciprocity.

D. price discrimination.

E. kickbacks

From the question, we are informed about a statement ""I'll let you sell the Harley-Davidson designer clothes only if you'll also sell a new line of clothes designed by Paula Abdul, too."

This statement made by a salesperson to a specialty retailer is potentially an example of tie- sales and may be in violation of the Clayton Act prohibition if the action substantially lessens competition.

It should be noted that tie - in sales in finance means that when a cusumer buys a goods he/she must buy the other product, it simply means the products are tied, and this is opposite of Clayton Act which was set up to bring end to transactions that can lead to monopolies.

3 0
3 years ago
Jamie Lee has decided to purchase a certified pre-owned vehicle. What might she expect as far as reliability and a warranty on t
babunello [35]

The things which Jamie Lee <em>might expect</em> as far as reliability and a warranty on the used car is:

  • No factory fault
  • Low mileage
  • Accident free, etc.

<h3>What is a certified pre-owned vehicle?</h3>

This refers to a fairly used car which has been certified by factory standards that has been accident free and has very low mileage and is expected to work without much problems.

With this in mind, we can see that because Jamie Lee has decided to purchase a pre-owned vehicle, the things which she would expect in terms of reliability and warranty is that it should give her little to no problems

Read more about pre-owned vehicle here:
brainly.com/question/2450677

6 0
2 years ago
The ________ market is where securities are initially issued and the ________ market is where pre-owned securities (not new issu
Lubov Fominskaja [6]

Answer: Option(a) is correct.

Explanation:

Correct option: Primary; secondary

Primary market is a market in which new stocks and securities are issued for the first time. Firms are selling their shares and bonds for the first time to the public. For example; IPO (Initial Public Offering).

Secondary market is a market in which buying and selling of already owned securities takes place. In this type of market investors trade with each other rather than with issuing firm.

4 0
3 years ago
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