Author Question: If a bank's deposits at the Fed increase by 10 million, then A) both the bank's liabilities and ... (Read 54 times)

future617RT · **on:** Jun 30, 2018

If a bank's deposits at the Fed increase by 10 million, then

A) both the bank's liabilities and the Fed's liabilities increase by 10 million.
B) the bank's assets increase by 10 million, but there is no change at the Fed since it does not really have assets or liabilities.
C) the bank's assets increase by 10 million and the Fed's liabilities increase by 10 million.
D) both the bank's assets and the Fed's assets increase by 10 million.

Question 2

If the interest rate is 4 percent, how much interest would the retiree earn the first year if she opted for the lump sum payment, and chose to invest the entire payment at this interest rate?

A) 1,400 B) 20,000 C) 55,000 D) 235,000