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Consider a bank with the following balance sheet: Assets Liabilities Required reserves $10 million Checkable deposits $130 million Excess reserves $32 million Bank capital $18

Consider a bank with the following balance sheet:

Assets

Liabilities

Required reserves

$10

million

Checkable deposits

$130

million

Excess reserves

$32

million

Bank capital

$18

million

Loans

$70

million

Assume that required reserves are 8%. In order to avoidinsolvency, regulators decide to provide the bank with $27 million in bank capital. Assume that bad news about mortgages is featured in the local newspaper, causing a bank run. As a result, $35 million in deposits is withdrawn. Show the effects of the capital injection and bank run on the balance sheet below. (Round your responses to the nearest whole number.)

Assets

Liabilities

Required reserves

$ ???

million

Checkable deposits

$ ???

million

Excess reserves

$ ???

million

Bank capital

$ ???

million

Loans

$ ???million

Was the capital injection enough to stabilize the bank? The bank now has a capital ratio of ?? %, and the bank is ( In dire capital position OR well capitalized)? (Round your response to one decimal place.)

If the bank regulators decide that the bank needs a capital ratio of 10% to prevent further runs on the bank, how much of an additional capital injection is required to reach the 10% capitalratio?(Round your response to one decimal place.)

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