1.) For a bank balance sheet shown in the following table, calculate the leverage ratio aand risk-adjusted leverage ratio. Is the bank well captiatlized? Risk factor for Municipal Bonds is .5. Risk factor for real estate lons is 1.

Assets Reserves $11M T-Bills $20M Municipal Bonds $25M Real Estate Loans $50

Liablities Checkable Deposits $100M Bank Capital $6

2.) If deposits fall by $5M. How the balance sheet looks like? Are there any problems? Note the required reserve ratio is 10%

3.) From Question 1, if the real estate loans realized $5M loss, how does the balance sheet looks like? Are there any problems?