Bank's Role in Internal Electronic Payments
Two individuals, Sarah and Tom, both have checking accounts at 'First National Bank'. Sarah uses her banking app to send $50 to Tom. From the perspective of First National Bank, explain precisely what changes on its books to complete this transaction. Focus on the bank's obligations to Sarah and Tom.
0
1
Tags
Economics
Economy
Introduction to Macroeconomics Course
Ch.6 The financial sector: Debt, money, and financial markets - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
CORE Econ
Social Science
Empirical Science
Science
Application in Bloom's Taxonomy
Cognitive Psychology
Psychology
Related
Unaffected Bank Balance Sheet During Internal Payment Transfers
Analogy Between Marco-Julia Model Payments and Modern Electronic Transactions
Two individuals, Alex and Ben, both hold accounts at the same bank. Initially, the bank's records show it has a liability of 100 units to Alex and a liability of 50 units to Ben. Alex then uses a banking app to make a payment of 30 units to Ben. Considering only this transaction, which of the following statements correctly analyzes the new state of the bank's liabilities?
Manual Bank Transaction
Bank's Role in Internal Electronic Payments
When a customer uses a banking app to pay another customer at the same bank, the transaction is completed by the bank reducing its total assets to reflect the transfer of funds.