Beleaguered state bank (bsb) holds $250 million in deposits and maintains a reserve ratio of 10 percent.

(a) show a t-account for bsb.
(b) now suppose that bsb’s largest depositor withdraws $10 million in cash from her account. if bsb decides to restore its reserve ratio by reducing the amount of loans outstanding, show its new t-account.
(c) explain what effect bsb’s action will have on other banks.
(d) why might it be difficult for bsb to take the action described in part (b)? discuss another way for bsb to return to its original reserve ratio.

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

No, because there could be bacteria in the solution