The Implementation of BIS Capital Requirements May Be Expected to

question 80

Multiple Choice

The implementation of BIS capital requirements may be expected to

• A)increase the downward trend in loan sales because of higher required capital levels.
• B)increase the downward trend in loan sales because of the use of risk adjusted assets.
• C)decrease the downward trend in loan sales because of the use of risk adjusted assets.
• D)decrease the downward trend in loan sales because of higher required capital levels.
• E)decrease the downward trend in loan sales because of the use of risk adjusted assets, and decrease the downward trend in loan sales because of higher required capital levels.

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Definitions:

Straight-Line Method

A method of calculating the depreciation of an asset, which spreads the cost evenly over its useful life.

Depreciation Expense

The portion of the cost of a fixed asset that is recognized as an expense in the income statement over its useful life.

Revalued Upward

Revalued upward is a term used in accounting to indicate an increase in the book value of an asset to reflect its current market value.

Subsequent Depreciation

The allocation of an asset's cost over its useful life, considering any adjustments made following the asset's initial measurement and recognition.