Use the Following Balance Sheet (Values in Thousands of Dollars)

question 57

Multiple Choice

Use the following balance sheet (values in thousands of dollars) to answer the question. If the bank experiences a $50 000 sudden liquidity drain caused by a loan commitment draw down, what will be the impact on the balance sheet if stored liquidity management techniques are used?

• A) A reduction in cash of $21 000 and an increase in demand deposits of $29 000.
• B) A reduction in securities and/or current loans totalling $50 000.
• C) A reduction in cash of $21 000 and a decrease in securities holdings of $29 000.
• D) A decrease in equity of $50 000.

---

Definitions:

Virus

A tiny infectious agent that replicates only inside the living cells of other organisms, affecting all types of life forms.

AZT

Azidothymidine, a medication used to prevent and treat HIV/AIDS, it works by inhibiting the enzyme reverse transcriptase.

HIV Life Cycle

The series of steps the HIV virus takes to replicate and infect host cells, including attachment, fusion, reverse transcription, integration, replication, assembly, and budding.

Drug Therapies

Medical treatments that utilize medications to treat various diseases and conditions.