In the CAMELS framework, capital adequacy refers to:

1)	having a sufficient amount of capital to protect the bank against insolvency

2)	having a reasonable level of default potential and risk

3)	having bank officers with the ability to effectively react to changes in the banking environment

4)	generating an appropriate rate of return and value

5)	effectively managing short-term assets and liabilities

The process of determining the value of one entity by using values of other entities relative to firm characteristics is called:

1)	discounted cashflow analysis

2)	multiples valuation

3)	asset-liability management

4)	loan loss provisioning

5)	efficiency ratio