2.6. Determine the following: 2.6.1.Herfindahl-Hirschman index (HHI) with the following information of the six banks' deposits; 2.6.2.If the biggest and smallest bank (in terms of deposits) merge, what will be the HHI for all the remaining banks? | 2.6.3.Will the merger be allowed? (Ch. 9) A B C Bank ($ in millions) 70 60 80 90 D 120 E 140 F 200

2.6. Determine the following: 2.6.1.Herfindahl-Hirschman index (HHI) with the following information of the six banks' deposits; 2.6.2.If the biggest and smallest bank (in terms of deposits) merge, what will be the HHI for all the remaining banks? | 2.6.3.Will the merger be allowed? (Ch. 9) A B C Bank ($ in millions) 70 60 80 90 D 120 E 140 F 200

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 8P

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Construct a bank balance sheet with the following items : reserves , deposits , loans , securities , capital , and debt . Choose values so that the reserve -deposit ratio is 10 percent and the leverage ratio is 10. Give an example of a change in asset values that would push bank capital to zero . What happens when bank capital is gone ?
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