question and answer
September 3, 2020
according to the rule for optimal input usage, a firm should hire a person as long as his or her marginal revenue product is greater than his or her…
September 3, 2020

Does anybody know the answer to this problem? It would be appreciated

14. Consider a commercial bank with $100 million in deposits, $15 million in reserves, $70 million incommercial loans, $10 million in bonds, and $10 million in stocks.a) What is the value of the bank’s capital? b) Suppose the economy enters into a recession: defaults on the commercial loans cause themto lose 10% of their value and the value of the bank’s stocks fall by half. Depict thesechanges using a t—account. C) Is the bank illiquid? Is it insolvent? Explain what the implications are for the bank’s practices.

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