A commercial bank has capital of $5000 and a leverage ratio of 10. If the value of the bank’s assets increases by 5%, then its capital has _____ to ______. Select one: a. increased / $5,250 b. increased / $5,500 c. decreased / $4,500 d. decreased / $4,000 e. decreased / $2,500

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A commercial bank has capital of $5000 and a leverage ratio of 10. If the value of the bank’s assets increases by 5%, then its capital has _____ to ______.

Select one:

a. increased / $5,250

b. increased / $5,500

c. decreased / $4,500

d. decreased / $4,000

e. decreased / $2,500

 

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