1. To raise the equity multiplier, you may opt for which of the following:
a. Reduce the amount of bank capital by buying back some of the bank’s stock
b. Reduce the amount of bank capital by paying higher dividends to stockholders, thereby reducing the bank’s retained earnings
c. Keep bank capital constant but increase the bank’s assets by acquiring new funds, say by issuing CDs and then increasing loans or purchasing more securities with these funds
d. All of the above answers e. None of the above answers.
2. Compute the Accounts Payable Period based on the following information:
ABC Products provides the following information.
Average Accounts Payable Balance is as follows: $800,000
Annual Cost of Goods sold is as follows: $9,000,000
Assume 365 days. Compute the Accounts Payable period