2. [2] What are three causes of banks losing their cost advantages in acquiring funds in recent years?

3. [2] What are three reason banks have been losing income advantages on their assets in recent years

4. [1] Has the invention of the computer been a major factor behind the decline of the banking industry? Explain your answer.

5. [1] Why is loophole mining so prevalent in the banking industry in the United States?

6. [1] What role did the shadow banking system play in the decline of U.S. commercial banking?

7.[1] How do sweep accounts allow banks to avoid reserve requirements?

8. [1] How did commercial banks respond to their relative decline in traditional banking?

9. [2] Tyler Bank starts its first day of operations with $9 million in capital. A total of $130 million in checkable deposits is received. The bank makes a $25 million commercial loan and another $50 million in mortgages. Assume that required reserves are 8%. (a) What does the bank balance sheet look like? (b) How well capitalized is the bank? (c) Calculate the risk-weighted assets and risk-weighted capital ratio after the banks first day assuming reserves risk weights are 0%, mortgages rates are 50% and commercial loan rates are 100%.

Assets	Liabilities