Economic Capital Is

question 65

Multiple Choice

Economic capital is:

• A)the asset and liability values of an FI reported according to their historical costs
• B)the amount of capital that the DI's shareholders are prepared to contribute so that the business remains as a going concern
• C)a measure of an FI's capital that is equal to the difference between the market value of its assets and the market value of its liabilities
• D)allows balance sheet values to reflect current rather than historical prices

---

Definitions:

Nuts

Usually refers to edible seeds enclosed in a hard shell, considered healthy snacks and used as ingredients in various dishes.

Utility Function

A utility function represents the preferences of a consumer over a set of goods or services by assigning values to each possible bundle, reflecting the satisfaction gained.

Berries

Small, juicy fruits with seeds enclosed within the flesh, often consumed raw or used in various culinary dishes.

Nuts

Edible seeds encased in hard shells, often consumed as snacks or used as ingredients in cooking.