A manager decides not to lend to any firm in sectors that generate losses in excess of $5$ percent of

capital.

a$.$ If the average historical losses in the automobile sector total $8$ percent, what is the maximum loan a

manager can lend to firms in this sector as a percentage of total capital?

b$.$ If the average historical losses in the mining sector total $15$ percent, what is the maximum loan a

manager can make to firms in this sector as a percentage of total capital?