Question
Goldman Bank's Initial Balance Sheet ($s) Assests Liabilities Reserves 15,000 Demand Deposits 300,000 Loans 600,000 Capital Stock 400,000 Securities 100,000 Interbank Borrowing 30,000 Berhane deposits
Goldman Bank's Initial Balance Sheet ($s)
| Assests | Liabilities | ||
| Reserves | 15,000 | Demand Deposits | 300,000 |
| Loans | 600,000 | Capital Stock | 400,000 |
| Securities | 100,000 | Interbank Borrowing | 30,000 |
Berhane deposits $20,000 into Goldman Bank.
As a result of this deposit:
What will be the change to Goldman's Liabilities?
| Assests | Liabilities | ||
| Reserves | 15,000 | Demand Deposits | Answer320,000300,000320,000 |
| Loans | 600,000 | Capital Stock | Answer390,000400,000410,000 |
| Securities | 100,000 | Interbank Borrowing | 30,000 |
What will be the change to Goldman's Assets?
| Assests | Liabilities | ||
| Reserves | Answer15,00035,000 | Demand Deposits | 300,000 |
| Loans | Answer600,000619,000620,000 | Capital Stock | 400,000 |
| Securities | 100,000 | Interbank Borrowing | 30,000 |
If the desired reserve ratio (r) is 5%, how much excess reserves does Goldman Bank have after Berhane's $20,000 deposit?
| 0 | 2,000 | 19,000 | 15,000 |
What is the maximum amount of new loans that can be created by Goldman Bank?
| 0 | 2,000 | 19,000 | 15,000 |
If Goldman Bank lends out all excess reserves to Ted, what changes will occur to Goldman's Balance sheet?
| Assests | Liabilities | ||
| Reserves | Answer15,00017,00035,000 | Demand Deposits | Answer340,000339,000320,000300,000 |
| Loans | Answer600,000619,000620,000 | Capital Stock | 400,000 |
| Securities | 100,000 | Interbank Borrowing | 30,000 |
If Ted writes a cheque for the total amount of the loan and the cheque is cashed, what will the changes be to Goldman Bank's Balance sheet?
| Assests | Liabilities | ||
| Reserves | Answer15,00016,00035,000 | Demand Deposits | Answer340,000339,000320,000300,000 |
| Loans | Answer600,000619,000620,000 | Capital Stock | 400,000 |
| Securities | 100,000 | Interbank Borrowing | 30,000 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored 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
ISO IEC 27002 2022 Auditors Handbook A Comprehensive Resource For Auditing Of ISO IEC 27002 Information Security, Cybersecurity And Privacy Controls
Authors: Oliver Gruhn-van Dorp
1st Edition
B0CHKY19X2, 979-8858543510
