How can we o determine the extent to which borrowed funds havebeen used to finance assets?

Q: why yield to maturity is important in pricing loans in financial system?

A: Yield to Maturity is the rate of return or the interest rate of a fixed-rate security, such as a…

Q: Why might credit ratings agencies give different credit ratings to sovereign debt issued by the same…

A:

Q: Bakersfield Credit Union starts with $200 in bank capital (or owners' equity) and a leverage ratio…

A: Here, we calculate the given as follow;

Q: Assuming that the average duration of First National Bank's $100 million assets is five years, while…

A: Formula to be used: ∆NW = [ (-Da) * ∆i / 1+ i * assets vale ] - [ (-Dl) * ∆i / 1 + i * liability…

Q: Ms. Huma is expecting a rise in the share price of Bank Muscat. But, currently she does not have the…

A: Since it is given in the question that Ms. Huma is expecting a rise in the share price of bank…

Q: What economic functions do financial intermediaries perform?

A: finacial intermediaries perform following economic functions :- 1.they provide fund against interest…

Q: 16. when banks match between buyers and savers, thus; they could be defined in term of the economic…

A: The bank is an institution that accepts deposit from the public, offer loans, and provide various…

Q: Refers to the ease at which an asset can be converted.into cash O Liquidity O Store of Value O…

A: Money is an essential object to every economy. It serves various functions in an economy. The most…

Q: Deuce loans $5,000 to Ace. Ace puts up his 1955 MG Roadster as collateral and signs a security…

A: Below is the given information: The amount of loan = $5000 Collateral goods = 1955 MG Roadster

Q: “The more collateral there is backing a loan, the lessthe lender has to worry about adverse…

A: The situation of asymmetric information is an economics theory of contract which is intricate in…

Q: c. Small businesses use these to raise funds for investment. Loan | Stock | Bond d. This is also…

A: Loan: A loan is an agreement between borrower and lender that implies the borrower is borrowing a…

Q: 47) The demand curve for bonds has the usual downward slope, indicating that at prices of the bond,…

A: In the bonds market, it can be seen that the demand curve of bonds is usually downward sloping…

Q: Illustrate the relationship between assets and liabilities?

A: Assets are something that a business owns and liability is what a business owe to others. To own…

Q: How much money will you have in seven yearsif you deposit $7,000 in the bank at 8.5%…

A: Compound interest rate is addition to the interest of interest. It can be applicable both loan and…

Q: (c) Discuss how the “lemons problem” keep securities market from being effective in channelling…

A: "The Market for Lemons: Quality Uncertainty and the Market Mechanism" is a well-known 1970 paper by…

Q: Explain the main two types that the company could prefer to use them as a source of finance

A: Sources of finance refers to the fields which can offer funds to a business to operate in an…

Q: Suppose Aurumville Bank has $20300 in assets, and its total capital equals $11000. What is the total…

A: Assets = $20,300 Capital = $11,000 ----------------------

Q: A principal of $20,000 is invested at 6% for 10 years. Determine its future value if the interest…

A: NOTE: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: A bank has a capital of $200 and a leverage ratio of 5. If the value of the bank's assets declines…

A: Leverage ratio: The leverage ratio is the ratio of the bank's total assets to the total capital of…

Q: Please show work

A: The amount deposited 5 years ago is $1,000 and the amount deposited one year ago is $2,000.The…

Q: se: All assets are protected in debt reorganization. False

A: There are two types of debts - 1) secured debt - money lended against some security or asset. In…

Q: Mention the four main financial derivatives and tell when each is good for strategic financial…

A: Those financial instruments whose price is determined by the value of another asset are termed as…

Q: ow the E-banking services help the rural bank in having low Return on Equity and Return on Assets…

A: Banks are always looking for ways to increase their profits. Rural banking services are clearly more…

Q: The efficiency of the bank can be measured through the ROE (Return on equity). O True False

A: Meaning of Financial Assets: The term financial assets refer to the situation, under which these…

Q: If you suspect that a company will go bankrupt nextyear, which would you rather hold, bonds issued…

A: The firm's capital structure will include a share of debt and equity. The level of debt and equity…

Q: Bear Stearn case: In light of the collapse of the hedge funds, how serious were Bear’s credit…

A: Bear Stearn case: In light of the collapse of the hedge funds, how serious were Bear’s credit…

Q: Explain Borrowed-Funds Concept?

A: A firm can raise capital to finance its investment projects via borrowing or equity. Borrowed…

Q: The $5-bill in your pocket (Canadian) is: (check all that apply) Select all that apply: O a. A…

A: A 5$ Canadian currency in your pocket act as liquid asset for me, but at the same time a liability…

Q: What function of money is highlighted when someone deposits a portion of his or her paycheck into an…

A: Money means the medium of exchange.

Q: The following table shows the streams of income produced by several different assets. In each case,…

A: Returns refer to the sum or percentage of sum that investors or depositors of a certain sum of money…

Q: Which of the following is not a role of financial intermediaries? A. Maturity intermediation O B.…

A: In a market, financial intermediaries are the individual who work for making a connection between…

Q: 10 major differences between islamic and convential banking

A: The tenets of Islamic banking are Shariah laws. Convential banking depends upon the fundamentals of…

Q: C) What is the maximum amount of money that can be created by this bond transaction?

A: Bond transaction refers to the transaction of transferring ownership of the bonds by both parties at…

Q: en it is said that commercial banks are financial intermediaries, what is meant by this? What is…

A: A financial arbitrator is a business that acts as an intermediary between two parties in a financial…

Q: 3.57 Consider the following three individuals. Just after their 19th payment: o Robert Dixon had a…

A: An installment loan is an expansive, general term that alludes to by far most of both individual and…

Q: 6. Which of the ollowing s a liability on a bank's balance sheet? a. a certificate of deposit b.…

A: Bank assets allude to the things possessed by a bank that assistance to bring esteem. Bank assets…

Q: Write brief notes on the new tier system of the pension scheme operating in Ghana

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Explain LIFO reserve and LIFO liquidation and their eff ects on financial statements and ratios

A: A decline in the LIFO reserve from a prior period is an indication that LIFO liquidation has…

Q: What factors influence your decision of where to put your money? a.  What financial institutions…

A: The Investment environmental elements that impact an investor's decision may be divided into many…

Q: Examine the balance sheet of commercial banks in the tolowing tabie. Aseta ion al Liaie andSetorth…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Required Reserve and Excess Reserve Analysis

A required reserve is an amount of cash that banks must keep with themselves, which is certain percentage of the deposits made by their customers. Required reserve is a percentage of the bank's deposits that the respective bank must have on each overnight. The percentage rate is set and determined by the nation’s central bank. It is important to have such funds accumulated to meet its uncertain obligations, sudden liabilities and withdrawals. Required reserve is also known as reserve ratio. Reserve ratio is an important tool to control the money supply.