Which of the Following Is Not a Least-Cost Resolution (LCR)

question 54

Multiple Choice

Which of the following is not a Least-Cost Resolution (LCR) requirement under FDICIA?

• A)Consider and evaluate all possible resolution alternatives by computing and comparing their costs on a present value basis, using realistic discount rates.
• B)Place a bank or thrift into receivership as soon as its capital falls below some positive book value level.
• C)Document the evaluation and the assumption on which it is based.
• D)Retain documentation for at least five years.
• E)Select the least costly alternative based on the evaluation.

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Definitions:

Tax Liability

The total amount of tax that an individual or entity is legally obligated to pay to tax authorities.

Average Tax Rate

The portion of total taxable income that is paid in taxes, calculated by dividing the total tax amount by the total income.

Average Tax Rate

The ratio of total taxes paid to total taxable income, representing the percentage of income that goes towards taxes.

Taxable Income

The amount of an individual's or a company's income used to determine how much tax they owe to the government in a given tax year.