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If the normal and targeted GAP and ROE are earned by a depository institution, what explains the relationship between the ROA versus the ROE? The

If the normal and targeted GAP and ROE are earned by a depository institution, what explains the relationship between the ROA versus the ROE?

  1. The environment of low interest rates.
  2. The relatively low capital position of depository financial institutions.
  3. The relatively heavy reliance on the money market borrowing by depository institutions.
  4. The very high liquid, cash, position of depository institutions.

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