Explanation:
Net liquidity position = Cash inflows – Cash outflows
| Cash Inflows | Cash Outflows |
|---|---|
| Deposit inflows | Deposit withdrawals |
| Scheduled loan repayments | Acceptable loan requests |
| Borrowings from money market | Operating expenses |
| Stockholders dividend payments | |
| Repayments of bank borrowings |
Therefore, ABC Bank's net liquidity position at the end of the coming week is given by:
= (70 + 150 + 120) − (80 + 110 + 50 + 30 + 50) = USD 20 million
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Q.5379 The following are ABC Bank's estimates of cash inflows and outflows for the coming week.
| Cash Flows | USD Million |
|---|---|
| Scheduled loan repayments | 150 |
| Acceptable loan requests | 110 |
| Borrowings from money market | 120 |
| Operating expenses | 50 |
| Deposit withdrawals | 80 |
| Deposit inflows | 70 |
| Stockholders dividend payments | 30 |
| Repayments of bank borrowings | 50 |
What is ABC Bank's net liquidity position at the end of the coming week?
A
20
B
-20
C
120
D
150
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