Exhibit 14-1
Exhibit 14-1 -Refer to Exhibit 14-1

Exhibit 14-1
Exhibit 14-1
$\begin{array}{llll}&&\text {EUBANK}\\\text {Assets }&&\text {Liabilities and Net Worth }\\\hline\text { Deposits at the Fed } & \$ 40,000 &\text {Checkable deposits }&\$500,000\\\text { Cash } & \$ 10,000 &\text {Net Worth }&\$20,000\\\text { Loans } & \$ 300,000 \\\text { Securities } & \$ 150,000 \\\text { Fed Stock } & \$ 20,000\end{array}$
-Refer to Exhibit 14-1.If the interest rate on loans is 10 percent,the annual cost to Eubank of holding excess reserves is

A) 10 percent of $500,000
B) 10 percent of net worth
C) 10 percent of excess reserves
D) $10,000
E) 0

Correct Answer:

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