In order to reduce the likelihood of excessive leverage in the banking system, governments have traditionally
A) imposed capital requirements on commercial banks.
B) imposed capital requirement on investment banks.
C) imposed capital requirements on both commercial and investment banks.
D) imposed asset requirements on all banks.
A
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Assuming there is a rise in supply of copper, if the market for copper is allowed to adjust, the ultimate result will be:
A) an increase in price and an increase in the quantity demanded. B) an increase in price and an increase in the quantity supplied. C) a decrease in price and an increase in the quantity demanded. D) a decrease in price and an increase in the quantity supplied.
Consider a firm in the short run. Average product is at its maximum when
A) average product equals marginal product and marginal product is falling. B) marginal product is maximized. C) the maximum quantity of the variable input is employed. D) diminishing returns cease to operate. E) total product is maximized.
In the long run, a monopolistically competitive firm
A. earns zero economic profits. B. earns negative economic profits. C. can have positive, zero, or negative profits. D. earns positive economic profits.
One of the consequences of the U.S. trade deficit is that:
A. domestic inflation has resulted. B. the accumulation of American dollars in foreign hands has enabled foreign firms to build factories in America. C. the distribution of income in the United States has become less unequal. D. the system of flexible exchange rates has been abandoned in favor of a new gold standard.