Show as many calculations as possible Time: about two hours. I1] True or False? (25 points) (1) in Basel I regulations on credit risk, the riskier the loan, the higher the proportion of equity that is needed to fund it. (2) Interbank loans are generally seen as a cheap and but unstable source of funding for commercial banks. (3) An inverted yield curve, in which long-term interest rates are lower than short-term interest rates is a good situation for commercial banks because their cost of funds is based on short-term rates, while the interest they charge on loans is based on long-term interest rates. (4) The Basel Committee on Bank due to unexpected changes in the difference between long-term and short-term interest rates. Is that statement true or false? Supervision defines an operational loss as the loss in market value (5) Net interest margin is defined as interest income minus the cost of funding (6) During a yield curve bear flattener' move, interest rate risk decreases. (7) Deutsche Bank lends 500 million to Petrobras, the Brazilian oil company. The loan is funded in Germany. Therefore, Deutsche Bank runs cross-border country risk