City Bank has estimated that its average dally net transaction accounts balance over the recent 14-day computation period was $229.50 million. The average dally balance with the Fed over the 14 -day maintenance period was $8.5 million, and the average dally balance of vauit cash over the two-week computation period was $6 million. EXAMPLE 13-2 Computation of Dally Average Required Reserves Consider ABC Bank's reserve manager, who wants to assess the bank's minimum cash reserve requirement target. The manager knows the bank's net transaction accounts balance at the close of the banking day on each of the 14 days over the period Tuesday, June 30, to Mondry, July 13. Consider the realized net transaction account positions of ABC Bank in Table 13-25. The minimum daily average renerves that a bank mute maintain is compoted as a peroentage of the daily average tet transaction accounts beld by the bank over the two-week conquation period, where Friday's balances are carried over for Saturday and Sunday. The minimam daily avenge for ABC Bank to hold againu the daily wenege of 51,150.70 miltion in net trunaction accounts is calcalated as follows (amounts in millions): Daily averagenet thaniaction accounts Reserve percentage = Daily average neserves required a. Under the rules effective in 2020 , what is the amount of avegage daily reserves required to be held during the reserve maintenance period for these demand deposit balances? b. What is the average dally balance of reserves held by the bank over the maintenance period? By what amount were the average a. Under the rules effective in 2020 , what is the amount of average dally reserves required to be held during the reserve maintenance period for these demand deposit balances? b. What is the average dally balance of reserves held by the bank over the maintenance period? By what amount were the average reserves held higher or lower than the required reserves? c. If the bank had transferred $35 million of its deposits every Friday over the two-week computation period to one of its off-shore facilities, what would be the revised average dally reserve requirement? Complete this question by entering your answers in the tabs below. Under the rules effective in 2020, what is the amount of average daily reserves required to be held during the reserve maintenance period for these demand deposit balances? (Do not round intermediate calculations. Enter your answer in militions rounded to 3 decimal places, (e.9.32.161) ) What is the average daily balance of reserves held by the bank over the maintenance per average reserves held higher or lower than the required reserves? (Input the amount as a in millions rounded to 3 decimal places. (e.9., 32.161)) Complete this question by entering your answers in the tabs below. If the bank had transferred $35 million of its deposits every Friday over the two-week computation period to one of its offshore facilities, what would be the revised average daily reserve requirement? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places. (e.9.32.161) ) Rovisod average dally reserve requirement million
