Purchase Solution

Banks: Assets and Liabilities

Not what you're looking for?

Ask Custom Question

First look at the ASSET side of your balance sheet. What are the major economic differences between bank loans and investments? Aren't both intended to generate profits?

Now look at the LIABILITY side of your balance sheet. What are the major economic differences between deposits and borrowed funds? Aren't both intended to finance loans and investments cost-effectively?

Purchase this Solution
Solution Summary

This response addresses the queries posed in 304 Words, APA References.

Solution Preview

The response address the queries posted in 395 words with references.
// In order to satisfy this query, you must be aware about the assets, liabilities & balance sheet. You are required to define major economic differences between bank loans & investments and deposits & borrowed funds. I am going to assist you on these points which would help you to write your paper. See the text below: //
Bank loans and investments both are on the asset side of the balance sheet. Both are intended to generate profits through earning returns on them. But there are some differences between both of them. The returns on the bank loans are in the form of interest while ...

Solution provided by:
Ashish Sharma, MBA (IP)
Education
  • MBA (IP), International Center for Internationa Business
  • BBA, University of Rajasthan
Recent Feedback
  • "Thank You so much! "
  • "Always provide great help, I highly recommend Mr. Sharma over others, thanks again. "
  • "great job. I will need another help from you. "
  • "first class!"
  • "Thank you for your great notes. Will you be willing to help me with one more assignment? "
Purchase this Solution
Free BrainMass Quizzes
Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

View More Free Quizzes
Related BrainMass Solutions

  • deferred acquisition costs, high debt ratios, credit risk

    The mismatch between the bank's portfolio of assets and its portfolio of liabilities happens because when transformation occurs and a large amount of its liabilities are short-term liabilities but its assets are long-term assets.

  • Discuss: Marking All Assets and Liabilities to the Market

    433734 Discuss: Marking All Assets and Liabilities to the Market What are the arguments for and against requiring banks to mark all assets and liabilities to market continuously? Relate your arguments to managing credit risk and interest rate risk.

  • RESERVE REQUIREMENTS

    BANK A BANK B ASSETS LIABILITIES ASSETS LIABILITIES Reserves 0.8 Deposits 10.0 Reserves 1.2 Deposit 10 Loans 8.0 Borrowing 0 Loans 8.0

  • Federal Reserve and domestic money supply

    its own citizens and domestic institutions The liabilities side of a balance sheet lists as liabilities: Deposits of private banks Currency in circulation The Federal Reserve's liabilities are the base of the domestic money supply process.

  • Enterprise/Systemic Risk

    ) and a list of uses of funds (assets).

  • Monetary policy multiple choice

    B) whenever banks create financial liabilities for themselves, they create financial assets for individuals, and those financial assets are considered money.

  • Prepare a statement of cash - ERNEST BANKS COMPANY

    Then, we will determine the increase or decrease for assets and liabilities and owner's equity in the balance sheet as shown above.

  • Ernest Banks Company

    20,000 13,000 Land 40,000 40,000 Property, plant, and equipment 200,000 225,000 Less: Accumulated depreciation ( ( 50,000) (67,500) Total $ 277,000 $283,500 Liabilities

  • Bank Balance Sheets and Finance

    Calculate the banks risk-weighted assets before and after the agreement.

  • Effect of a Bond Purchase on a Bank's Balance Sheet

    This solution explains how the banking system's assets and liabilities are affected by an open market bond purchase by the Federal Reserve, and how the transaction will affect the money supply.

View More Related Solutions