Answer the following statements true (T) or false (F)
1. The Fed traditionally can grant loans to commercial banks, but not to investments banks and securities firms.
2. The Financial Crisis of 2007-2008 halted the consolidation in the U.S. financial industry that had caused a declining number but increasing size of firms in the industry prior to the crisis.
3. The so-called moral-hazard problem in financial management refers to the fact that managers will tend to take on more risk if they know that they are somehow insured against some or all of their losses.
4. The TARP loans and the Fed's lender-of-last-resort actions that bailed out large, failing financial institutions helped reduce the moral-hazard problem in financial management.
5. Insurance companies are a major category of financial institutions.
1. True
2. False
3. True
4. False
5. True
You might also like to view...
For "an increase in the quantity demanded" but not "an increase in demand" to occur, there must be a
A) rightward shift of the demand curve. B) movement along the demand curve. C) rightward shift of the demand curve and a movement along the demand curve. D) Both answers B and C are correct.
General equilibrium analysis
A. concerns competitive equilibrium only in the factor markets. B. concerns competitive equilibrium only in the product markets. C. concerns competitive equilibrium in a single market, considered in isolation. D. is the study of competitive equilibrium in many markets at the same time.
Huge wage differentials paid for small differences in performance is an example of
a. the failure of the Lorenz curve to accurately reflect income distribution b. winner-take-all c. the failure of the Gini coefficient to accurately reflect income distribution d. a negative income tax system that disproportionately rewards the rich e. the different kinds of in-kind assistance that different people receive
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher