GARP Exam 2016-FRR Topic 2 Question 1 Discussion

Actual exam question for GARP's 2016-FRR exam

Question #: 1
Topic #: 2

[All 2016-FRR Questions]

Which one of the following four statements about economic capital of a bank is correct?

AEconomic capital measures how the economy is doing compared to the bank.

BEconomic capital reflects the possible losses that could occur based on the bank's own estimates of the risks it is taking.

CEconomic capital is determined by rules imposed by an external authority.

DEconomic capital is the present value of the earnings generated by the bank in the future.

Show Suggested Answer

Suggested Answer: B

by An at May 02, 2025, 06:55 AM

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