Which of the Following Contributed the Least to the Collapse

question 17

Multiple Choice

Which of the following contributed the least to the collapse of the FSLIC/FDIC deposit insurance funds?

• A)An increase in interest rate volatility.
• B)Enhanced investment powers granted to thrifts.
• C)Fraudulent behavior induced by the greed of the decade of the 80s.
• D)Fraudulent behavior induced by ineffective regulatory incentives.
• E)The extension of deposit insurance to uninsured depositors.

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Definitions:

Treasury Stock

Shares of a company's own stock that it has repurchased from shareholders and can hold, reissue, or retire.

Common Stock

Represents ownership shares in a corporation, giving shareholders voting rights and a residue claim on corporate earnings in the form of dividends.

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to investors, which are reinvested in the business.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been subtracted from total revenues.