Question
Consider the following statements: 1. Capital
Adequacy Ratio (CAR) is the amount that banks have to maintain in the form of their own funds to offset any loss that banks incur if the account-holders fail to repay dues 2. CAR is decided by each individual bank. Which of the statements given above is/are correct?Solution
Statement 1 is correct : Capital Adequacy Ratio (CAR) is the amount that banks have to maintain in the form of their own funds to offset any loss that banks incur if the account-holders fail to repay dues. Statement 2 is incorrect : It is decided by central banks and bank regulators to prevent commercial banks from taking excess leverage and becoming insolvent in the process
Change the question mark with the option that follows the logic applied to the first pair.
Plant : Seed :: Flower : ??
Choose the word which is different from the rest
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