What is maximum loan manager can lend to firms

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Reference no: EM132012526

A manager decides not to lend to any firm in sectors that generate losses in excess of 5 percent of capital.

If the average historical losses in the automobile sector total 8 percent, what is the maximum loan a manager can lend to firms in this sector as a percentage of total capital?

If the average historical losses in the mining sector total 10 percent, what is the maximum loan a manager can lend to firms in this sector as a percentage of total capital?

Reference no: EM132012526

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