The Basel Capital Requirements Are Based Upon the Premise That

question 127

Multiple Choice

The Basel capital requirements are based upon the premise that

• A)banks with riskier assets should have higher capital ratios.
• B)banks with riskier assets should have lower capital ratios.
• C)banks with riskier assets should have lower absolute amounts of capital.
• D)banks with riskier assets should have higher absolute amounts of capital.
• E)there is no relationship between asset risk and capital.

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Definitions:

Overweight

A condition where an individual has more body weight than is considered healthy for their height, often assessed by body mass index (BMI).

Obese

A medical condition characterized by excessive body fat, which presents a risk to health.

Binge-Eating Disorder

A disorder marked by frequent binges but not extreme compensatory behaviors.

Compensatory Behavior

Actions taken to offset or make up for a perceived flaw or mistake.