A moral hazard B transactions costs C adverse selection D all of the above 21

A moral hazard b transactions costs c adverse

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20) _____ A) B) C) D) all of the above.   moral hazard.  transactions costs.  adverse selection.  21) 
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Which of the following is NOT an example of off-balance-sheet lending?  21) _____ a loan commitment  a loan sale  a standby letter of credit  a swap    22)  The McFadden Act of 1927  22) _____ prohibited national banks from operating branches outside their home states.  established the Federal Reserve System.  put a tax on the issuance of bank notes by state banks.  separated commercial banking from investment banking.    23)  Bank borrowing from the Fed is referred to as:  23) _____ repurchase agreements  reverse repurchase agreements  discount loans  federal funds    24)  The ratio of a bank's after-tax profit to bank capital is known as  24) _____
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A) B) C) D)  return on capital.  spread.  net interest margin.  return on equity.    25)  If you deposit $300 in your bank and the required reserve ratio is 10%, your bank will have  25) _____ an increase in required reserves of $270.  an increase in required reserves of $300.  an increase in required reserves of $3000.  an increase in required reserves of $30 and an increase in excess reserves of $270.    26)  If a bank's ratio of assets to capital is 25 and it's return on assets is -5%, what is its return on equity?  26) _____ -125%  -30%  -0.2%  -5%    ROE=ROA x (asset/capital)
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27)  If a bank has $200,000 of checkable deposits, a required reserve ratio of 20 percent, and it holds $80,000 in reserves, then  the maximum deposit outflow it can sustain without altering its balance sheet is  27) _____ $50,000.  $40,000.  $30,000.  $25,000.    28)  If, after a deposit outflow, a bank needs an additional $3 million to meet its reserve requirements, the bank can   28) _____ A) B) C) D)  increase loans by $3 million.  reduce deposits by $3 million.  sell $3 million of securities.  repay its discount loans from the Fed.    29)  On a bank's balance sheet, assets are  29) _____ 40,000 required reserves. Has 80,000 reserves (200000-X)*.02=80000-X .8x=40,0000
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the sources of acquired funds.  the uses of acquired funds.  those items owed by the bank to depositors and others.  by definition equal to the bank's liabilities.    30)  Which of the following is a bank liability? 
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