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Suppose a bank has $100 million in assets, and $90 million in liabilities. If assets increase...

Suppose a bank has $100 million in assets, and $90 million in liabilities. If assets increase 5%, and liabilites increase 10%, then how much did bank’s equity change? (Answer is 6.0) please show me how with work!!!

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Expert Solution

Bank's Equity is the excess of Bank's Assets over its Liabilities
Particulars Before Change After Change
Assets $                    100 $                105
Liabilities $                      90 $                  99
Bank's Equity $                      10 $                     6

The Bank's equity decreases to $6 million.

ekkarill92 answered 2 years ago
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