QUESTION
Assume that Bank A receives a primary deposit of $100,000 and that it must keep reserves of 10 percent against deposits.a. Prepare a simple balance sheet of assets and liabilities for the bank immediately after the deposit is received.b. Assume Bank A makes a loan in the amount that can be âsafely lent.â Show what the bankâs balance sheet of assets and liabilities would look like immediately after the loan.c. Assume that a check in the amount of the âderivative depositâ created in Part b was written and sent to another bank. Show what Bank Aâs (the lending bankâs) balance sheet of assets and liabilities would look like after the check is written. Answer:Enter the answers in blue shaded cellsASSETSLIABILITIESTFTFASSETSLIABILITIESTFTFTFASSETSLIABILITIESTFTFTF
ANSWER:
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