A bank’s balance sheet has to BALANCE it’s assets (debt owed to the bank), and it’s liabilities (debt the bank owes to depositors).

If a bank’s liabilities outweigh it’s assets, it cannot make it’s payments and is insolvent.

This is happening to alot of banks now, and is why the fed does QE- to help the banks stay solvent.

So the answer is 3. 🙂

It’s only the return on each asset. Trust me.

When determining how to allocate their assets among reserves, loans, and financial securities, banks must first make sure that their reserves are sufficient to meet the reserve requirement set by their regulators. Bankers can then choose how to allocate the remainder of their assets between holding additional reserves, making loans, and investing in securities. Each one of these asset types comes with a different level of risk and rate of return. Riskier assets tend to yield a higher rate of return; thus, individual banks choose the asset allocation that provides the correct balance of risk and profit.

The total size of the monetary base and the total value of liabilities both affect the total value of a bank’s assets, but they do not directly influence the manner in which a bank chooses to allocate those assets.

The reserve requirement was the only correct answer for me

The answer is only the size of the monetary base (#1). I just got this question wrong on Aplia and it told me the correct answer after I submitted my guess.

The total value of liabilities. via APLIA. Not sure where those other Aplia users are getting their answer, but it is ONLY

The Total Value of Liabilities.

The answer is the reserve requirement

Ah, a joker’s paradise corner!

i just got this answer wrong. it is the return on each asset.

no the riskiness of each asset. i just finished this question on aplia

A bank’s balance sheet has to BALANCE it’s assets (debt owed to the bank), and it’s liabilities (debt the bank owes to depositors).

If a bank’s liabilities outweigh it’s assets, it cannot make it’s payments and is insolvent.

This is happening to alot of banks now, and is why the fed does QE- to help the banks stay solvent.

So the answer is 3. 🙂

It’s only the return on each asset. Trust me.

When determining how to allocate their assets among reserves, loans, and financial securities, banks must first make sure that their reserves are sufficient to meet the reserve requirement set by their regulators. Bankers can then choose how to allocate the remainder of their assets between holding additional reserves, making loans, and investing in securities. Each one of these asset types comes with a different level of risk and rate of return. Riskier assets tend to yield a higher rate of return; thus, individual banks choose the asset allocation that provides the correct balance of risk and profit.

The total size of the monetary base and the total value of liabilities both affect the total value of a bank’s assets, but they do not directly influence the manner in which a bank chooses to allocate those assets.

The reserve requirement was the only correct answer for me

The answer is only the size of the monetary base (#1). I just got this question wrong on Aplia and it told me the correct answer after I submitted my guess.

The total value of liabilities. via APLIA. Not sure where those other Aplia users are getting their answer, but it is ONLY

The Total Value of Liabilities.

The answer is the reserve requirement

Ah, a joker’s paradise corner!

i just got this answer wrong. it is the return on each asset.

no the riskiness of each asset. i just finished this question on aplia

A bank’s balance sheet has to BALANCE it’s assets (debt owed to the bank), and it’s liabilities (debt the bank owes to depositors).

If a bank’s liabilities outweigh it’s assets, it cannot make it’s payments and is insolvent.

This is happening to alot of banks now, and is why the fed does QE- to help the banks stay solvent.

So the answer is 3. 🙂

It’s only the return on each asset. Trust me.

When determining how to allocate their assets among reserves, loans, and financial securities, banks must first make sure that their reserves are sufficient to meet the reserve requirement set by their regulators. Bankers can then choose how to allocate the remainder of their assets between holding additional reserves, making loans, and investing in securities. Each one of these asset types comes with a different level of risk and rate of return. Riskier assets tend to yield a higher rate of return; thus, individual banks choose the asset allocation that provides the correct balance of risk and profit.

The total size of the monetary base and the total value of liabilities both affect the total value of a bank’s assets, but they do not directly influence the manner in which a bank chooses to allocate those assets.

The reserve requirement was the only correct answer for me

The answer is only the size of the monetary base (#1). I just got this question wrong on Aplia and it told me the correct answer after I submitted my guess.

The total value of liabilities. via APLIA. Not sure where those other Aplia users are getting their answer, but it is ONLY

The Total Value of Liabilities.

The answer is the reserve requirement

Ah, a joker’s paradise corner!

i just got this answer wrong. it is the return on each asset.

no the riskiness of each asset. i just finished this question on aplia