[BM] Chap 6

26. Financial institutions that pursue the "quiet life" as a goal face less risk of losing earnings or market share.

• True

• False

26. Financial institutions that pursue the "quiet life" as a goal face less risk of losing earnings or market share.

• True

• False

28. If the expected stream of future dividends for a bank's shareholder rises, the bank's stock price should also rise, other factors held constant.

• True

• False

29. If the discount factor associated with the value of a bank's stock rises, the bank's stock price should rise, other factors held constant.

• True

• False

30. A bank's ROA equals its ROE times the ratio of total assets divided by total equity capital.

• True

• False

31. According to the textbook, a bank's asset-utilization ratio reflects the mix and yield on a bank's portfolio of assets.

• True

• False

32. A bank's profit margin or ratio of net after-tax income to total operating revenue is a measure of financial leverage for a bank.

• True

• False

33. According to the text, the ratio of a bank's net after-tax income to pre-tax net operating income is a measure of tax management efficiency.

• True

• False

34. According to the textbook, the ratio of a bank's pre-tax net operating income to total operating revenues is a measure of expense-control efficiency

• True

• False

35. The ratio of non-performing assets to total loans and leases is a measure of credit risk in banking industry.

• True

• False