Which of the Following Statements Is True

question 52

Multiple Choice

Which of the following statements is true?

• A)RAROC is the risk-adjusted return on capital.
• B)RAROC is calculated as the capital at risk divided by the loan's income.
• C)RAROC should always be below an FI's RAROC benchmark as otherwise the FI increases its default risk exposure.
• D)None of the listed options are correct.

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Definitions:

Creative Intelligence

A form of intelligence that involves the capacity to be intellectually flexible and innovative.

Robert Sternberg

An American psychologist known for his theory on love and intelligence, including the triangular theory of love and the triarchic theory of intelligence.

Intellectually Flexible

The ability to adapt one's thinking and understanding in response to new information, situations, or perspectives.

Overweight

Being overweight is having a body weight above the standard weight range for one's height, which can lead to health problems.