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      Question

      When a bank chooses the wrong strategy or follow a

      long-term business strategy which might lead to its failure, it is called
      A Credit risk Correct Answer Incorrect Answer
      B Operational risk Correct Answer Incorrect Answer
      C Market risk Correct Answer Incorrect Answer
      D Business risk Correct Answer Incorrect Answer
      E Interest risk Correct Answer Incorrect Answer

      Solution

      When a bank chooses the wrong strategy or follows a long-term business strategy that may lead to its failure, it is called "Business Risk." Business risk refers to the possibility that a bank's earnings or financial position may be negatively impacted by factors that are inherent in the bank's business operations. It is a broad category of risk that includes strategic risk, reputational risk, and other risks that arise from the bank's business activities.

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