Get your original paper written from scratch starting at just $10 per page with a plagiarism report and free revisions included!
|Assets||Liabilities and equity|
|Plant and equipment||30||Equity||22|
The asset-liability management committee has estimated that the loans, whose average interest rate is 5 percent and whose average life is five years, will have to be discounted at 8 percent if they are to be sold in less than two days. If they can be sold later than a week, the DI will receive the full market value. Loans are not amortized; that is, the principal is paid at maturity.
In a crisis, if depositors all demand payment on the second day, what amount will they receive? Assume no deposit insurance.
$ 60.04 millions
$ 72.04 millions
$ 85.04 millions
$ 82.42 millions