A bank has $200 million in assets and $150 million in liabilities.The banks net worth is _____________ million and its leverage ratio is __________________.

Question

Quizplus · Accepted Answer

The bank's net worth is calculated as assets minus liabilities, which is $200 million - $150 million = $50 million. The leverage ratio is calculated as assets divided by net worth, which is $200 million / $50 million = 4 to 1.

A Bank Has $200 Million in Assets and $150 Million