Question: Suppose a bank maintains an average clearing balance of 5
Suppose a bank maintains an average clearing balance of $5 million during a period in which the Federal funds rate averages 6 percent. How much would this bank have available in credits at the Federal Reserve Bank in its district to help offset the charges assessed against the bank for using Federal Reserve services?
Relevant QuestionsWhat are sweep accounts? Why have they led to a significant decline in the total legal reserves held at the Federal Reserve banks by depository institutions operating in the United States?First National Bank of Belle Mead has forecast its checkable deposits, time and savings deposits, and commercial and household loans over the next eight months. The resulting estimates (in millions) are shown below. Use the ...Elton Harbor Bank has a cumulative legal reserve deficit of $44 million as of the close of business this Tuesday. The bank must cover this deficit by the close of business tomorrow (Wednesday). Charles Tilby, the bank's ...Describe the essential differences between the following deposit pricing methods in use today: cost-plus pricing, conditional pricing, and relationship pricing.What are core deposits, and why are they so important today?
Post your question