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The balance sheet for Bank A, B, C and D are presented below ($ millions): Assets Bank A Bank B Bank C Cash $30 $15

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The balance sheet for Bank A, B, C and D are presented below ($ millions): Assets Bank A Bank B Bank C Cash $30 $15 $30 Loans 90 105 105 Short term securities 50 50 50 Total assets $170 $170 $185 Liabilities and equity Deposits $110 $110 $110 Borrowed funds $40 $40 55 Equity $20 $20 20 5 Total liabilities and equity $170 $170 $185 $60 If each bank (Bank A, B,C, and D) decide to exercise a $10 million loan commitment, what the impact on the size of the above banks in dollar value if bank A and D use purchased liquidity and bank, B uses stored liquidity and bank C uses 80% from purchased liquidity and the rest from stored liquidity. (a) Bank D $7 50 3 $60 $50 5 The balance sheet for Bank A, B, C and D are presented below ($ millions): Assets Bank A Bank B Bank C Cash $30 $15 $30 Loans 90 105 105 Short term securities 50 50 50 Total assets $170 $170 $185 Liabilities and equity Deposits $110 $110 $110 Borrowed funds $40 $40 55 Equity $20 $20 20 5 Total liabilities and equity $170 $170 $185 $60 If each bank (Bank A, B,C, and D) decide to exercise a $10 million loan commitment, what the impact on the size of the above banks in dollar value if bank A and D use purchased liquidity and bank, B uses stored liquidity and bank C uses 80% from purchased liquidity and the rest from stored liquidity. (a) Bank D $7 50 3 $60 $50 5

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