If a bank has an ROA of 1.2% and Tier 1 Leverage Capital Ratio of .20% (i.e., .20 as a fraction) as a proxy for equity to total assets, what is the bank's ROE?
A) ROE of 6%
B) ROE of 12%
C) ROE of 18%
D) ROE of 20%
Correct Answer:
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