acquiring new funds and then seeking out new loan business or purchasing more securities with these new
8. If a bank is falling short of meeting its capital requirements by $1 million, what three things can it do to
rectify the situation?
9. Why do equity holders care more about ROE than about ROA?
10. If a bank doubles the amount of its capital and ROA stays constant, what will happen to ROE?
11. What are the benefits and costs for a bank when it decides to increase the amount of its bank capital?
12. Why is being nosy a desirable trait for a banker?