Questions from Financial Markets

Q: Any town Bank has the following ratios: a. Profit

Any town Bank has the following ratios: a. Profit margin: 21% b. Asset utilization: 11% c. Equity multiplier: 12× Calculate Any town’s ROE and ROA.

Q: Every town Bank has the following ratios: a. Profit

Every town Bank has the following ratios: a. Profit margin: 5% b. Asset utilization: 20% c. Equity multiplier: 7.75× Calculate Every town’s ROE and ROA.

Q: You have been asked to analyze First Union Bank. You have

You have been asked to analyze First Union Bank. You have only the following information on the bank at year-end 2018: Net income is $250,000, total debt is $2.5 million, and the bank’s debt ratio is...

Q: A mutual fund has 300 shares of General Electric, currently trading

A mutual fund has 300 shares of General Electric, currently trading at $30, and 400 shares of Microsoft, Inc., currently trading at $54. The fund has 1,000 shares outstanding. a. What is the NAV of th...

Q: To be adequately capitalized, what are the bank’s CET1, Tier

To be adequately capitalized, what are the bank’s CET1, Tier I, and total risk–based capital requirements under Basel III? Data for Problem 13: A bank...

Q: Does the bank have enough capital to meet the Basel requirements,

Does the bank have enough capital to meet the Basel requirements, including the capital conservation buffer requirement? Data for Problem 16: A bank’s balance sheet information is...

Q: Using the Tier, I leverage-ratio requirement, what is

Using the Tier, I leverage-ratio requirement, what is the bank’s minimum regulatory capital requirement to keep it in the adequately capitalized zone? Data for Problem 14: A bank&a...

Q: An insurance company collected $12.75 million in premiums and

An insurance company collected $12.75 million in premiums and disbursed $9.18 million in losses. Loss adjustment expenses amounted to 20.1 percent and dividends paid to policyholders totaled 5 percent...

Q: Calculate the following: a. If the loss ratio on

Calculate the following: a. If the loss ratio on a line of property insurance is 73 percent, the loss adjustment expense is 12.5 percent, and the ratio of commissions and other acquisitions expenses i...

Q: An insurance company’s projected loss ratio is 77.5 percent,

An insurance company’s projected loss ratio is 77.5 percent, and its expense ratio is 23.9 percent. It estimates that dividends to policyholders will add another 5 percent. What is the minimum yield o...