The table below shows the balance sheet for the Regal Bank, a hypothetical commercial bank. Assume that the Regal Bank has achieved its target reserve ratio.

a. What is the Regal Bank's target reserve ratio?

b. What is the value of the owners' investment in the bank?

c. Suppose someone makes a new deposit to the Regal Bank of \(\$ 100 \). Draw a new balance sheet showing the immediate effect of the new deposit. What is the Regal Bank's new reserve ratio?

d. Suppose instead that someone withdraws \(\$ 100 \) cash from the Regal Bank. Show the new balance sheet and the new reserve ratio.

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Assets Balance Sheet: Regal Bank Liabilities Reserves Loans. $ 200 Deposits $4000 $4200 Capital $ 400