An FI Has $5 Million in Cash Reserves with the Fed

question 52

Multiple Choice

An FI has $5 million in cash reserves with the Fed in excess of its reserve requirements, $5 million in T-Bills, and a credit line of $10 million to borrow in the repo market.It currently has lent $2 million in the Fed Funds market and borrowed $1 million from the Federal discount window to meet its seasonal needs. What are the bank's total available sources of liquidity?

• A)$17 million.
• B)$18 million.
• C)$20 million.
• D)$21 million.
• E)$22 million.

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Definitions:

Response Time

The duration it takes for a system or service to react to a given input or request.

Total Logistics Costs

The overall expenses associated with the planning, implementing, and controlling of the movement and storage of goods and services from their point of origin to the point of consumption.

Supply Chain Network

A configuration of institutions, workers, functions, data, and resources tasked with the movement of a good or service from the originator to the client.

Last Mile Delivery

The final step in the delivery process from a distribution center or facility to the end customer, often the most expensive and time-consuming part.