Frm book 2 questions
- On the wiley books part 2- page 4 under the learning objective ” Evalaute the capital requirements for banks” there is a sentence that says in this scenario a loss of 02.5 would wipe out half the equity capital but the bank would survive. why is this 1/2? it should be 0.25 right?
- Also under the learning objective “Describe the key features of the various categories of insurance companies and identify the risks facing insurance companies” there is a sentence that says “whole life insurance”- this is sometimes called permeant insurance….meaning the insurance have a guaranteed payout”. What does this mean? Why does this mean it has a guaranteed payout. Page 9 of book 2 of CHristian cooper’s Wiley books.
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