If a Bank's Return on Equity Remains Constant, but the Ratio

question 53

Multiple Choice

If a bank's return on equity remains constant, but the ratio of bank assets to bank capital increases:

• A) the bank's return on assets must have increased.
• B) the bank's return on assets must have decreased.
• C) the bank's assets and capital must have increased by the same percentage.
• D) the bank must be unprofitable.

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Definitions:

Survival Value

The significance of behaviors in increasing an organism's chance of survival and reproduction.

Helping Behaviors

Refers to actions taken to benefit another person or group without expecting anything in return.

Drive-Reduction Theory

A theory in psychology that explains motivation as being rooted in the desire to reduce internal tensions caused by unmet biological needs.

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Psychological stress or discomfort that arises from conflicting beliefs, thoughts, or feelings within oneself.