Question

How does the Risk Based Capital (RBC) approach benefit companies with good risk management systems?

a.

They are required to keep higher capital reserves.

b.

They are not affected by changes in regulatory requirements.

c.

They are required to keep lower capital reserves.

d.

They are exempt from regulatory oversight.

Answer: (c).They are required to keep lower capital reserves. Explanation:Companies with good risk management systems benefit from the RBC approach by being required to keep lower capital reserves.

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Q. How does the Risk Based Capital (RBC) approach benefit companies with good risk management systems?

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