Bank's capital includes:

Question

BlackTom AI · Accepted Answer

To evaluate the statement, begin by identifying what constitutes a bank's capital. Bank capital typically comprises the shareholders' funds (equity) plus accumulated retained profits that are reinvested in the business, serving as a cushion against losses and supporting financial stability.
Option a: 'deposits and Shareholder's funds.' Deposits are liabilities to the bank (customer funds that the bank owes), not part of the bank's capital. So this pairing incorrectly includes a liability with capital.
Option b: 'borrowed funds and accumulated retained profits.' Borrowed funds are also liabilities (debt) rather than capital. While retained profits are part of equity, the inclusion of borrowed funds makes this option inaccurate for capital.
Option c: 'deposits and borrowed funds.' Both components are clearly liabilities to the bank, not capital. Combining two liabilities does not reflect the bank's own net worth or cushion against losses.
Option d: 'shareholder's funds and Accumulated retained profits.' This combines equity (shareholder's funds) with retained earnings (accumulated profits that have not been distributed as dividends), which together form the core of bank capital used to absorb losses and support growth.
In summary, the crucial distinction is between funds the bank owes to others (deposits, borrowings) and the funds that belong to the owners (equity) plus reinvested earnings (retained profits). The correct concept aligns with option d, where the elements are internal resources that constitute capital rather than external liabilities.

Bank's capital includes:

查看解析

登录即可查看完整答案

类似问题

Question33 Suppose that homeowners pay back $12 million of residential mortgages, and the bank uses the proceeds to finance a new bridge of a BB- rated borrower. Will this transaction affect capital levels? [select: , Yes, No]. ResetMaximum marks: 3 Flag question undefined

Bank's capital includes:

Bank capital performs several important roles except:

Bank capital performs several important roles except:

Bank capital performs several important roles except:

Bank's capital includes:

Bank capital performs several important roles except:

Bank capital performs several important roles except:

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单