Choose the correct answer$-$a$.$ The Basel I framework increases the quality of capital and increasesthe coverage of risks.PINKb. The Basel III framework increases the quality of capital and increasesthe coverage of risks.c$.$ The Basel II framework increases the quality of capital and increasesthe coverage of risks.d$.$ The Basel II framework decreases the quality of capital and decreasesthe coverage of risks.risk is the risk that arises when firms or markets have the potential topropagate shocks or credit events and to inflict significant damage on thefinancial system and broader economy.a$.$ Businessb. Creditc. Strategicd. SystematicResearch suggests firm hedging $\_\_\_\_\_\_\_\_\_\_$the cost of externalfinancing and$\_\_\_\_\_\_\_\_\_\_$investments.a$.$ increases; increasesb. increases; decreasesc. decreases; decreasesd. decreases; increasesBasel I, was set$\_\_\_\_\_$as the minimum level of capital for banks to holdagainst risk$-$weighted assets $($RWA$).$a$.4\%$b$.6\%$c$.8\%$d$.10\%$Operational risk is:a$.$ Associated with default, bankruptcy, and downgradesb. Associated with inadequate or failed internal processes, people orsystems or external events like fraud or natural disasters.c$.$ Associated with the tendency for things to go wrong togetherd. None of the options.