A bank that has a low profit margin most likely:
A)is doing a poor job of controlling expenses.
B)has a small amount of financial leverage.
C)has a small amount of liquidity risk.
D)has assets that are not very productive.
E)None of the options is correct.

Question

Quizplus · Accepted Answer

A low profit margin indicates that the bank's revenue is not sufficient to cover its expenses. Therefore, it is likely that the bank is not effectively controlling its expenses.

A Bank That Has a Low Profit Margin Most Likely