QUESTIONS 1. Assume that the following banks have the same net amount of 2 million, but they are different due to the capital structure: BANKA Reserves Loans Total assets 120 900 1020 Deposits Bank Capital Total Liabilities and Equity 850 170 1020 BANKB Reserves Loans Total assets 1000 120 900 1020 Deposits Bank Capital Total Liabilities and Equity 20 1020 a. Which Bank is more attractive for shareholders? b. Which bank is riskier in case of loan depreciation at 20 million? Show your calculations to support your suggestions. 2. Could you define what is the yield curve? a. What are the three main theories that attempt to explain the yield curve? b. What does it mean an inverted yield curve? How does it compare to a normal yield curve