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Assets Liabilities and Equity Cash Required Reserves 21,000 Demand Deposits 550,000 Short-term Securities 369,000 Fed Funds Borrowed 151,000 Loans 400,000 Equity 89,000 Total 790,000 Total
| Assets |
| Liabilities and Equity |
|
| Cash Required Reserves | 21,000 | Demand Deposits | 550,000 |
| Short-term Securities | 369,000 | Fed Funds Borrowed | 151,000 |
| Loans | 400,000 | Equity | 89,000 |
| Total | 790,000 | Total | 790,000 |
a. If the bank's expected net deposit drain is +4 percent, what is the bank's expected liquidity requirement? Show work and discuss.
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