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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
2.15Â Â Â Â Regulators calculate that DLC bank (see Section 2.2) will report a profit that is normally distributed with a mean of $0.6 million and a standard deviation of $2.0 million. How much equity capital in addition to that in Table 2.2 should regulators require for there to be a 99.9% chance of the capital not being wiped out by losses?
2.16Â Â Â Â Explain the moral hazard problems with deposit insurance. How can they be overcome?
2.17Â Â Â Â The bidders in a Dutch auction are as follows:
Â
|
Bidder |
Number of Shares |
Price |
|
A |
60,000 |
$50.00 |
|
B |
20,000 |
$80.00 |
Â
Â
|
C |
30,000 |
$55.00 |
|
D |
40,000 |
$38.00 |
|
E |
40,000 |
$42.00 |
|
F |
40,000 |
$42.00 |
|
G |
50,000 |
$35.00 |
|
H |
50,000 |
$60.00 |
Â
The number of shares being auctioned is 210,000. What is the price paid by investors? How many shares does each investor receive?
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