10
AssignmentMultiple Choice

Managing Liability and Liquidity Risk

Question 10 • AHS Introduction to Careers in Finance

A bank has a LCR of 27 percent. As compared to other banks, this bank is _____.

Answer
A
well above the average
B
well below the average
C
at the average
D
very close to the average

Explanation

The LCR, or liquidity coverage ratio, measures a bank’s ability to cover short-term cash outflows with liquid assets. A ratio of 27% is far below the usual 100% regulatory benchmark, so this bank is well below the average. The correct choice is “well below the average.”

AI-written and checked against the verified answer.

Previous
Next