Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
Assets US Treasury Bonds Reserves (Cash) Loans First National Bank Liabilities and Net Worth $450,000 Net Worth $175,000 Checkable Deposits $125,000 $500,000 $250,000 Assets Property
Assets US Treasury Bonds Reserves (Cash) Loans First National Bank Liabilities and Net Worth $450,000 Net Worth $175,000 Checkable Deposits $125,000 $500,000 $250,000 Assets Property (Capital) Reserves (Cash) Second National Bank Liabilities and Net Worth $100,000 Net Worth S250,000 Checkable Deposits $250,000 $100,000 Assets US Treasury Bonds Reserves (Cash) Loans Third National Bank Liabilities and Net Worth $900,000 Net Worth $350,000 Checkable Deposits $250,000 $1,000,000 $500,000 Assume the Required Reserve Ratio is 20% for all banks. If Rob. a Third National Bank customer.writes a check for $100.000 to Darrin, a First National Bank Customer who deposits the check in full into his checking account then what impact has the transaction had on the loan creating potential of the banking system (these three banks? Increased by $80,000 B Increased by $100,000 Decreased by 580,000 Decreased by $100,000 Had no impact at all
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started