The question said there was $2 in equity I just used it. Whoever wrote the problem did something which made no sense.

He took All the Risk Weighted Assets then took out the liabilities.

Imagine I had $5 in cash and $1 in liabilities. Lets say the cash had no risk. Then according to you I have negative equity. Because the person that did it took Risk Weighted Assets IE 0 and minused liabilities IE 1 so the sum - 1

I did it correctly. Its Equity or capital divided by RWA.