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maxonik [38]
3 years ago
10

A bank currently has $150 million in "hot money" deposits against which it wants to hold an 80 percent reserve and $90 million i

n vulnerable deposits against which it wants to hold a 30 percent reserve. It also has $45 million in stable deposits against which it wants to hold a 5 percent reserve. Legal reserves for the bank are 5 percent of all deposits. What is the bank's liability liquidity reserve?
Business
1 answer:
Lyrx [107]3 years ago
8 0

Answer:

The right response is "141.7875".

Explanation:

According to the question,

The total reserves held will be:

=  0.8\times 150+0.3\times 90+0.05\times 45

=  120+27+2.25

=  149.25

Deductions will be:

=  5 \ percent \ of \ 149.25

=  0.05\times 149.25

=  7.4625

now,

The bank's liability liquidity reserve will be:

=  Total \ reserves \ held-Deductions

=  149.25-7.4625

=  141.7875

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