The Buffer Proposed by Basel III That Is Designed to Ensure

question 89

Multiple Choice

The buffer proposed by Basel III that is designed to ensure that DTIs build up a capital surplus outside of periods of financial distress is called the

• A)Capital conservation buffer.
• B)Countercyclical buffer.
• C)Leverage buffer.
• D)Tier II buffer.
• E)CET1 capital buffer.

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Definitions:

Canadian Dollar Appreciates

An increase in the value of the Canadian dollar relative to another currency.

Foreign Currency

Currency used in a country other than one's own, involved in international trade and investment.

Deficit Trade Balance

A situation where a country's imports exceed its exports, resulting in a negative trade balance.

Free Market

An economic system where prices for goods and services are determined by the open market and by consumers, with minimal government intervention.