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    Financial Institutions Management
  4. Exam
    Exam 19: Deposit Insurance and Other Liability Guarantees
  5. Question
    The Use of the Option Pricing Model to Determine the Actuarially
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The Use of the Option Pricing Model to Determine the Actuarially

Question 41

Question 41

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The use of the option pricing model to determine the actuarially fair premium for deposit insurance indicates that the cost of the insurance should rely on both the asset quality and level of leverage of the DTI.

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