When a Bank Is Expecting That the Overall Risk of FHC

question 65

Multiple Choice

When a bank is expecting that the overall risk of FHC will be reduced when they combine investment banking services with the traditional banking services,what type of effect are they expecting?

• A)Product-line diversification effect
• B)Market diversification effect
• C)Income diversification effect
• D)Geographic diversification effect
• E)None of the options is correct.

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Definitions:

Rule Of Five

A statistical rule stating that if a dataset contains more than five times the sample size of another, the larger can be considered approximately normal in distribution.

Expected Frequency

The number of occurrences predicted in a category of a contingency table based on the assumption of a particular hypothesis, commonly used in chi-squared tests.

Expected Frequency

The number of occurrences of an event expected in a study based on a probability model.

Sample Size

The number of observations or subjects used in a study or experiment, which represents a portion of the population being studied.