Question
Table 1 shows the financial position of the Smithville Bank once$3929.00 has beendeposited. Table 1. Original Assets and Liabilities AssetsLiabilitiesreserves:$3929.00 deposits:$3929.00 Assume that the required
Table 1 shows the financial position of the Smithville Bank once$3929.00 has beendeposited.
Table 1. Original Assets and Liabilities AssetsLiabilitiesreserves:$3929.00 deposits:$3929.00
Assume that the required reserve ratio is8.00%
.The bank manager decides to lend Billy Bob Smith all of the bank's excess reserves. Billy Bob takes the funds to Eula Mae's Used Machines and buys a pickup truck. Eula Mae then deposits the money in her account back at the SmithvilleBank.
Table 2. Assets and Liabilities After Bank Makes aLoanAssetsLiabilitiesreserves: ?deposits: ?loans: ?
Table 2 should show the bank's accounts after the loan is made and the funds againdeposited. Round all answers to the nearest cent.
What are the bank's loans in Table 2?
What are the bank's reserves in Table 2?
What are the bank's deposits in Table2?
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