Explanation:
Net liquidity position is calculated as the total supplies of liquidity minus the total demands for liquidity.
Supplies of liquidity (Inflows):
$100.0$60.0$80.0$30.0$10.0Total Supply = 100 + 60 + 80 + 30 + 10 = $280.0 million
Demands for liquidity (Outflows):
$70.0$90.0$20.0$50.0$40.0Total Demand = 70 + 90 + 20 + 50 + 40 = $270.0 million
Net liquidity position = Total Supply - Total Demand = $280.0 - $270.0 = +$10.0 million. Therefore, option B is correct.
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| Item | Amount ($) |
|---|---|
| Deposit withdrawals | $70.0 |
| Deposit inflows | $100.0 |
| Scheduled loan repayments | $60.0 |
| Acceptable loan requests | $90.0 |
| Borrowings from the money market | $80.0 |
| Sales of bank assets | $30.0 |
| Stockholder dividend payments | $20.0 |
| Revenues from sale of nondeposit services | $10.0 |
| Repayment of bank borrowings | $50.0 |
| Operating expenses | $40.0 |
What is the bank's projected net liquidity position?
A
-30.0 million
B
+10.0 million
C
+40.0 million
D
+90.0 million