Suppose the bank of Japan buys bond. what will happen to balance sheet Suppose t

Question

Suppose the bank of Japan buys bond. what will happen to balance sheet
Suppose the citizens pay tax for Japan, what will happen to balance sheet

About the Monetary Financial Payments Bank Policy System Markets |Assets Gold Cash Japanese government securities Commercial paper Corporate bonds Pecuniary trusts (stocks held as trust property Pecuniary trusts (index-linked exchange-traded funds held as trust property) Pecuniary trusts (Japan real estate investment trusts held as trust property Loans (excluding those to the Deposit Insurance Corporation) Foreign currency assets Deposits with agents Oth

Explanation / Answer

Suppose the bank of Japan buys bond. what will happen to balance sheet

Answer ) In case of a bank buys bond , this will consider as invesment for bank and position in the asset side in the investment category in the balance sheet of the bank.

Suppose the citizens pay tax for Japan, what will happen to balance sheet

Answer : I assumed that bank had collected tax from citizen on behalf of country .

Under this condition , any deposit made in tax account in the bank is liability for the bank , as bank has to pay all deposited amount to the government . But such deposit enchance the liquidity position of the bank and bank also charge a fee for this service , which will impact income statement of bank .

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