Basel III Pillar 1 Contains Methods for Estimating Minimum Capital

question 21

Multiple Choice

Basel III Pillar 1 contains methods for estimating minimum capital adequacy requirements for

• A)credit risk,market risk and interest rate risk.
• B)credit risk,liquidity risk and interest rate risk.
• C)credit risk,liquidity risk and capital risk.
• D)credit risk,market risk and operational risk.

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Definitions:

Tax-Deductible Expense

An expense that can be subtracted from gross income to reduce taxable income.

Corporation

A legal entity that is separate and distinct from its owners, who are known as shareholders.

Bonds

Long-term debt securities issued by corporations or governments to finance operations, projects, or other capital needs, paying periodic interest and the principal amount at maturity.

Stock

Stock represents ownership shares in a corporation, giving holders a claim on part of the company's assets and earnings.