19-72 Which of the Following Refers to Mandatory Actions That

question 38

Multiple Choice

19-72 Which of the following refers to mandatory actions that have to be taken by regulators as a DI's capital ratio falls.

• A)Capital forbearance.
• B)Prompt corrective action.
• C)Risk-based deposit insurance.
• D)Too-big-to-fail.
• E)Regulatory oversight.

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Definitions:

Efficient Frontier

Graph representing a set of portfolios that maximize expected return at each level of portfolio risk.

Market Portfolio

The portfolio encompassing all assets in which each asset is held in proportion to its market value.

Beta

The measure of the systematic risk of a security. The tendency of a security’s returns to respond to swings in the broad market.

Market Risk

Risk factors common to the whole economy; also called systematic or nondiversifiable risk.