Answer
a) Please see the first balance sheet.
b) 5
c) Please see the second balance sheet.
d) Assets decline by 9%, and the bank's capital declines by 45%. All of the loans were from the bank's capital, so that is why the capital declined more than the assets.
Work Step by Step
Leverage ratio = total assets / bank capital
Ratio = $1000/200$
Ratio = 5
$(910-1000)/1000$
$-90/1000$
$-.09$
$9%$
$(110-200)/200$
$-90/200$
$-.45$
$45%$
