Question: How would the public react to a lower equity-to-debt ratio of universal banks? The public may feel more confident about this bank because shareholders have

How would the public react to a lower equity-to-debt ratio of universal banks?

The public may feel more confident about this bank because shareholders have a lower stake in the bank profit.

The public may feel more confident about this bank because it shows the banks larger capacity to absorb operation loss.

The public may perceive it as a signal that banks are likely to invest in assets with high future returns.

None of the above is true.

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