Which of the Following Is a Measure of the Sensitivity

question 19

Multiple Choice

Which of the following is a measure of the sensitivity of loan losses in a particular business sector relative to the losses in an FI's loan portfolio?

• A)Loss rate.
• B)Systematic loan loss risk.
• C)Concentration limit.
• D)Loss given default.
• E)Expected default frequency.

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Definitions:

Short-Run Equilibrium

The condition in which, in the short term, the quantity of goods supplied equals the quantity of goods demanded at the current price.

Marginal Revenue

The income increment from disposing of an extra unit of a good or service.

Marginal Cost

The expenses involved in creating an additional unit of a product or service.

Maximize Profits

The process of increasing the difference between total revenues and total costs to achieve the highest possible earnings.