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Suppose daily losses (gains) from trading are independent and normally distributed with mean zero. How would you expect the relationship between economic and regulatory capital

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Suppose daily losses (gains) from trading are independent and normally distributed with mean zero. How would you expect the relationship between economic and regulatory capital to change if daily losses/gains are generated by a distribution with much heavier tails than the normal distribution? Select one: a. All answers above and/or below are incorrect b. Regulatory and economic capital will become closer together c. Regulatory and economic capital will move together without any changes d. Regulatory and economic capital will go further apart

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