The Covid-19 pandemic created considerable concern for the U.S. economy.  Actions were taken by the Federal Reserve during and shortly after the pandemic which dramatically impact the management of financial institutions.  Identify specific actions that were taken in 2020 in regard to: Reserve requirements Open market transactions Interest rates Ge specific with your answers and include the possible downside to each action taken.  

SUPERBANK has a required reserve ratio of 8%.  The bank holds no excess reserves and required reserves are currently $28 million.  If the bank has an outflow of deposits of $9 million dollars, the bank will have a reserve shortage.  Calculate the dollar amount of the reserves shortage: Do your work on a blank piece of paper.  You will upload this work along with a balance sheet as part of the final question of this exam.

Complete the following loan amortization by hand.  Please draw a table like the one below on your blank page and fill in each blank. You will take a picture of this chart and upload your completed chart at the end of the exam. Please show your work. Please do not forget to calculate the total finance (interest) charge for this loan.  You should enter the total interest (finance) charge in the blank prompt for this question.     You are considering purchasing a house for $285,000.  Do a three month loan amortization and calculate total finance charge.  Assume a 20 % down payment.    20 year 5.00% loan with one and a half discount points.   Beginning Balance Payment Principle Interest Ending Balance                                       FILL IN THE BLANK FOR.    Total finance charge:_____________________

A fixed coupon bond with 20 years to maturity has a coupon rate of 5.5%, with payments made annually.  What is the price the company would expect to see for this bond if it expects the yield to be 9%? * Draw a timeline of show all cashflows for this bond.  Submit the timeline with your hand-written work. *  

FAB-u-less BANK currently has $12 million in deposits and holds $600,000 in excess reserves.  A new customer comes along with a fabulous new deposit of $75,000.  Assuming that the bank policy is to hold a total of 11% of deposits in the form of reserves, how much would the bank required reserves increase on the new deposit?   Calculate the excess reserve ratio: Calculate the required reserve ratio:  How much would the bank required reserves increase on the new deposit? To receive full credit or to earn partial credit, please do your work on the hand-written page.  (Submit with all your hand-written work as the last problem on the exam.)     

FAB-u-less BANK currently has $10 million in deposits and holds $500,000 in excess reserves.  A new customer comes along with a fabulous new deposit of $65,000.  Assuming that the bank policy is to hold a total of 13% of deposits in the form of reserves, how much would the bank required reserves increase on the new deposit?   Calculate the excess reserve ratio: Calculate the required reserve ratio:  How much would the bank required reserves increase on the new deposit? To receive full credit or to earn partial credit, please do your work on the hand-written page.  (Submit with all your hand-written work as the last problem on the exam.) 

ABC Corporation just announced a 2-for-1 stock split.  Prior to the split the company had a market value of $3.6 billion with 90 million shares outstanding.  The split conveys no new information about the ABC Corporation. To receive full credit or to earn partial credit, please do your work on the hand-written page.  (Submit with all your hand-written work as the last problem on the exam.)  Prior to the split, what was the price per share of ABC Corporation stock? What is the value of ABC Corporation after the split? How many shares will be outstanding after the split? What will the price per share be after the split?    

SUPERBANK has a required reserve ratio of 8%.  The bank holds no excess reserves and required reserves are currently $30 million.  If the bank has an outflow of deposits of $7 million dollars, the bank will have a reserve shortage.  Calculate the dollar amount of the reserves shortage: Do your work on a blank piece of paper.  You will upload this work along with a balance sheet as part of the final question of this exam.

The deregulation of thrifts during the 1980’s is often sighted as cause for the savings and loan crisis of 1989. One such deregulation was the the DIDMCA (Depository Institutions Deregulation and Monetary Control Act).  Explain the major provisions of the DIDMCA (Depository Institutions Deregulation and Monetary Control Act).  Discuss additional deregulations passed during this time period and explain their relationship to the S & L Crisis. 

Second page of work (if needed)   Please write your name at the top of the submission and make sure the problems are clearly labeled.