A bank which has assets of $85 billion and a net worth of $10 billion must have:
A)liabilities of $75 billion.
B)excess reserves of $10 billion.
C)liabilities of $10 billion.
D)excess reserves of $75 billion.

Question

Quizplus · Accepted Answer

The formula for a bank's balance sheet is Assets = Liabilities + Net Worth. Therefore, Liabilities = Assets - Net Worth. Plugging in the given values, Liabilities = $85 billion - $10 billion = $75 billion.

A Bank Which Has Assets of $85 Billion and a Net