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Suppose that an FI holds two loans with the following characteristics. Estimate A and B using the loan allocation deviation formula. (A)=12.25%;(B)=14.14%(A)=14.14%;(B)=16.33%(A)=17.32%;(B)=20.0%(A)=16.33%;(B)=14.14% Assume the same
Suppose that an FI holds two loans with the following characteristics. Estimate A and B using the loan allocation deviation formula. (A)=12.25%;(B)=14.14%(A)=14.14%;(B)=16.33%(A)=17.32%;(B)=20.0%(A)=16.33%;(B)=14.14% Assume the same information as in the previous question Question Set 3. Which of the following observations concerning the Loan Volume-Based models and the Loan allocation deviation is not true? Deviation from the national benchmark is not necessarily bad. Bank B deviates from the national average more than Bank A. Bank A deviates from the national average more than Bank B. FI could generate high returns by serving specialized markets, impacting the bank's portfolio deviating from the national average
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