For a Given Level of Return on Assets, a Bank

question 28

Multiple Choice

For a given level of return on assets, a bank with a higher level of capital will have a lower

• A)return on equity.
• B)leverage measure.
• C)noninterest income.
• D)liquidity.

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Definitions:

Extended Contact Effect

The reduction of prejudice through indirect relationships, wherein knowing a member of an in-group has a friends in an out-group can lead to more positive attitudes towards that out-group.

Ingroup Favouritism

Behaviour that favours one’s own group over other groups.

Generalisation

The act or process of forming conclusions based on broad patterns, observations, or experiences that apply beyond specific instances.

Contact Hypothesis

A theory suggesting that under certain conditions, interpersonal contact is one of the most effective ways to reduce prejudice between majority and minority group members.