Which of the Below Statements Is FALSE

question 48

Multiple Choice

Which of the below statements is FALSE?

• A) Risk-based capital guidelines establish a credit risk weight for all assets where a weight depends on the credit risk associated with each asset.
• B) There are four credit risk classifications for banks: 0%, 20%, 50%, and 100%, arrived at on no particular scientific basis.
• C) The purpose of the Basel I Framework was to improve on the rules as set forth in the Basel I Framework by bringing risk-based capital requirements more in line with the underlying risks to which banks are exposed.
• D) The Basel Committee has several subcommittees whose stated purpose is to promote consistency in its implementation of the guidelines.

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Definitions:

Human Activities

Refers to actions or tasks performed by humans that affect the environment, society, and economy.

Atmosphere

The layer of gases surrounding Earth or another planet, essential for life as it provides air to breathe and protects from solar radiation.

Warmer World

A scenario indicating an increase in the Earth's average temperature, often associated with global climate change phenomena.

Hurricanes

Powerful tropical storms with heavy rain and winds exceeding 74 miles per hour, typically forming over warm ocean waters.