The earliest banks simply started out as wealthy persons decided to loan out some of their money to make money. Take the following example. A wealthy individual decides to take $$1$ million of their own money and use it loan out to friends and business acquaintances. At $3$ percent interest, they are able to loan out all of their funds.

a$.$ Construct a T$-$ account or bank balance sheet as found in Table $1,2,3,$ or $4$ in Chapter $14.$

b$.$ Assuming that all of their loans earn $3$ percent interest, how much are they earning per year on their loan? Explain or show your work. What rate of return are they earning on their $$1$ million? Explain.

c$.$ According to the definition given in Chapter $14$ is this bank leveraged or unleveraged? Explain.