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The following table shows the initial balance sheet of a hypothetical bank. There are no reserves requirements (the required reserve ratio is zero). However, reserves cannot go below zero. The Fed wouldn't like that. The borrowings are either from the Fed or from other banks. Start from the initial balance sheet above. Suppose that the firm makes an after tax profit of $6. This results in the following rates of returns: Rate of Return on Assets = percent Rate of Return on Equity = percent