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Use the information presented in Midwestern Mutual Bank’s balance sheet to answer the following questions.
| Bank’s Balance Sheet | |||
| Assets | Liabilities and Owners’ Equity | ||
| Reserves | $200 | Deposits | $675 |
| Loans | $800 | Debt | $250 |
| Securities | $1,000 | Capital (owners’ equity) | $1,075 |
Suppose the owners of the bank borrow $100 to supplement their existing reserves. This would ______ (increase or decrese) the reserves account and increase the _____ account.
This would also bring the leverage ratio from its initial value of to a new value of .
Which of the following do bankers take into account when determining how to allocate their assets? Check all that apply.
The total value of liabilities
The size of the monetary base
The reserve requirement
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