Matrix Bank Has Compiled the Following Migration Matrix on Consumer

question 18

Multiple Choice

Matrix Bank has compiled the following migration matrix on consumer loans.Which of the following statements accurately summarizes this data? $\begin{array}{lllll}&\text { Risk Grade at }\\&\text { End of year }\\&&1 & 2 & 3 & 4 \\\text { Risk grade at }&1&.88 & .08 & 02 & .02\\\text { beginning of }\\\text { year }\\2 & 10 & 84 & .03 & .02 \\3 & .02 & .09 & .78 & .11\end{array}$

• A)Ten percent of grade two loans were upgraded during the year.
• B)Grade one loans have a higher probability of downgrade than grades two or three.
• C)Grade three loans have a higher probability of upgrade than grade two loans.
• D)Grade three loans have a higher probability of downgrade than grade two loans.
• E)All of the options.

Interpret budgeting information to assess business performance and operational planning.

Understand the cash flow impacts derived from operating budgets including sales collection, purchases, and expense payments.

Evaluate the efficiency of production and labor utilization in budgeting processes.

Understand the components involved in preparing a Direct Materials Purchase Budget.

---

Definitions:

Spelling

The activity of correctly sequencing the letters that form a word.

Relies

Depends on or trusts in someone or something.

Spelling

The process or activity of writing or naming the letters of a word in correct sequence.

Potatoes

Tubers of the plant Solanum tuberosum, widely consumed worldwide as a vegetable or starch source.