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Consider a bank with the following balance sheet: Assets Llabllltles Desired reserves $10 million Chequable deposits $130 million Excess reserves $22 million Bank capital -

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Consider a bank with the following balance sheet: Assets Llabllltles Desired reserves $10 million Chequable deposits $130 million Excess reserves $22 million Bank capital - $18 million Loans $80 million Assume that desired reserves are 8%. To avoid insolvency, regulators decide to provide the bank with $26 million in bank capital. However, the bad news about mortgages is featured in the local newspaper, causing a bank mn. As a result, $35 million in deposits is withdrawn. Show the eflects of the capital injection and bank mn on the balance sheet, (Round your responses to the nearest whole number.) Assets Llabllltles Desired reserves $ million Chequable deposits $ 95 million Excess reserves 5 million Bank capital $ 8 million Loans million Was the capital injection enough to stabilize the bank? The bank now has a capital ratio of %, and the bank is i . (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 would be required to reach a 10% capital ratio? Bank regulators need to inject an additional $ million to reach a 10% capital ratio. (Round your response to one decimal place.)

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