Which of the Following Statements Is True

Multiple Choice

Which of the following statements is true?

A) Under BIS, the capital charge is calculated as DEAR multiplied by the square root of 10 multiplied by 3.
B) The idea of a minimum multiplication factor of 3 is to create a scheme that is 'incentive compatible'.
C) Regulators can punish FIs that underestimate their capital charges by raising the multiplication factor to as high as 5.
D) Under BIS, the capital charge is calculated as DEAR multiplied by the square root of 10 multiplied by 3 and the idea of a minimum multiplication factor of 3 is to create a scheme that is 'incentive compatible'.