Assignment 3 questions. This questions must be answered individually (not as a group) and uploaded to the assignment folder. Please note you should not use any AI tools to answer any of these questions, if found that you have got any help of ChatGPT to answer any questions, you will get zero mark 1. The bank you own has the following balance sheet: Assets Reserves Loans $ 75 million $525 million Liabilities Deposits Bank Capital $500 million $100 million If the bank suffers a deposit outflow of $50 million with a desired reserve ratio on deposits of 10%, what actions should you take? 2. If a bank finds that its ROE is too low because it has too much bank capital, what can it do to raise its ROE? 3. If a bank is falling short of meeting its capital requirements by $1 million, what three things can it do to rectify the situation? 4. Why do equity holders care more about ROE than about ROA? 5. What are the benefits and costs for a bank when it decides to increase the amount of its bank capital?

Assignment 3 questions. This questions must be answered individually (not as a group) and uploaded to the assignment folder. Please note you should not use any Al tools to answer any of these questions, if found that you have got any help of ChatGPT to answer any questions, you will get zero mark 1. The bank you own has the following balance sheet: If the bank suffers a deposit outflow of $50 million with a desired reserve ratio on deposits of 10%, what actions should you take? 2. If a bank finds that its ROE is too low because it has too much bank capital, what can it do to raise its ROE? 3. If a bank is falling short of meeting its capital requirements by $1 million, what three things can it do to rectify the situation? 4. Why do equity holders care more about ROE than about ROA? 5. What are the benefits and costs for a bank when it decides to increase the amoumt of its bank capital