12-59 Using Standard Deviations,which Bank Is in a Better Position

question 16

Multiple Choice

12-59 Using standard deviations,which bank is in a better position if the average earnings on the assets of Bank A is 11 percent and Bank B is 12 percent (ignore all other factors) ?

• A)Bank B,because it earnings of 12 percent is higher than Bank A's 11 percent while,its standard deviation is lower.
• B)Bank B,because its earnings of 12 percent is higher compared to Bank A's 11 percent,while its standard deviation is higher.
• C)Bank B,because its earnings of 12 percent is higher compared to Bank A's 11 percent,while its standard deviation is the same.
• D)Bank A,because although its earnings of 11 percent is lower compared to Bank B's 12 percent,its standard deviation is significantly lower.
• E)Bank A,because although its earnings of 11 percent is lower compared to Bank A's 12 percent,its standard deviation is the same.

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Definitions:

Functional Fit

A measure of how well a particular strategy, process, or system suits the operational needs of an organization.

Concept Of Fit

The degree to which an individual's skills, values, and interests align with the culture and requirements of an organization or a specific job.

Strategic Framework

An overarching structure that guides the planning and decision-making processes within an organization.

Compensation

Financial and non-financial rewards given to employees in exchange for their work and service.