What are the essential differences between demand deposits


1. What are the principal accounts that appear on a bank's balance sheet (or Report of Condition)?

2. Which accounts are most important and least important on the asset side of a bank's balance sheet?The rank order of assets by dollar volume appearing on U.S. bank balance sheets are as follows:

3. What accounts are most important on the liability side of a bank's balance sheet? The principal bank liability items from most important to least important are:

4. What are the essential differences between demand deposits, savings deposits, and time deposits?

5. What are primary and secondary reserves and what are they supposed to do?

6. Suppose that a bank holds cash in its vault of $1.4 million, short-term government securities of $12.4 million, privately issued money market instruments of $5.2 million, deposits at the Federal Reserve banks of $20.1 million, cash items in the process of collection of $0.6 million, and deposits placed with other banks of $16.4 million. How much in primary reserves does this bank hold? In secondary reserves?

7. What are off-balance-sheet items and why are they important to some banks and other financial firms?

8. What is the relationship between the Provision for Loan Losses on a bank's Report of Income and the Allowance for Loan Losses on its Report of Condition?

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