ABE Banc has the following asset categories:
Cash .... $1 million
Securities .. $4 million
Loans .... ?
Other assets . $2 million
Total assets ... ?
a. What would be the bank’s total assets if loans were twice the size of the amount of securities?
b. If total assets were $12 million, what would be the amount of the loans?
c. If total assets were $11 million, and $1 million of securities were sold with the proceeds placed in the cash account, what would be the amount of the loans?