The Balance Sheet Below Is for Chartered Bank ABC

question 77

Multiple Choice

The balance sheet below is for chartered bank ABC.Assume the desired reserve ratio is 20 percent.All figures are in billions.

-Refer to the above information.The amount by which this single chartered bank and the amount by which the banking system can increase loans are respectively:

• A) $5,000 and $110,000.
• B) $5,000 and $25,000.
• C) $5,000 and,22,000.
• D) $5,000 and,27,000.

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Definitions:

Sales Margin

The difference between the sales revenue of a product and the cost of goods sold, expressed as a percentage of the sales revenue, indicating profitability.

Capital Turnover

A metric that evaluates how effectively a business leverages its capital to produce income.

Value Drivers

Factors that increase the value of a product or service to customers, directly impacting the company's performance and profitability.

Growth

An increase in the size, amount, or value of something, often seen as a positive development in economic, business, or personal contexts.