QUESTION 7 Which of the following regarding the (core deposits / assets) ratio is true? A higher ratio is generally better for lower liquidity risk because it is safe for a bank to rely on its core deposits as a source of funding. A high ratio means the bank relies more on other sources of funding like borrowed funds. A low ratio generally means low liquidity risk. A low ratio shows that a bank uses its core deposits to supply loans and this is good because core deposits are insured by the FDIC. None of the above. QUESTION 8 Which of the following is not true regarding Peer Group Ratio analysis? It is used to measure the relative liquidity exposure of banks by comparing financial statement ratios. It is usually used to compare two banks that are similar in size and geographic location. It must be conducted on banks in the same year. None of the above