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QUESTION 9 Bank A has a RWA of $5,000,000. Calculate its Basel III requirement for Tier 1 capital in order to avoid restrictions by the
QUESTION 9 Bank A has a RWA of $5,000,000. Calculate its Basel III requirement for Tier 1 capital in order to avoid restrictions by the regulator on its future assets' growth. Express your result in $000. You must not type $ sign or comas. You must round your result to ONE decimal when your answer is expressed in $000. If your result is $10,530 you will be required to type 10.5. 4,4 QUESTION 10 In January 2020, a bank purchases a government bond for $102 as a source of future income through coupons. Due to economic conditions, in April 2020, the price of the bond has fallen to $97. The price remains unchanged between April 2020 and June 2020, where the bond is then sold. We consider the story above in two different systems: the historical value accounting system and the mark-to-market accounting system. Which of the following statements is CORRECT? O A. Only under the mark-to-market accounting system will there be an unrealised capital gain of $5 in June. B. Only the balance sheet entry for the purchase transaction is identical under both systems. The balance sheet entries under both accounting systems will be identical at all stages. D. The balance sheet entries under both accounting systems will be different at all stages. E. None of the above statements are correct
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