Why Is the Failure of a Large Bank More Detrimental

question 76

Multiple Choice

Why is the failure of a large bank more detrimental to the economy than the failure of a large steel manufacturer?

• A)The bank failure usually leads to a government bailout.
• B)There are fewer steel manufacturers than there are banks.
• C)The large bank failure reduces credit availability throughout the economy.
• D)Since the steel company's assets are tangible, they are more easily reallocated than the intangible bank assets.
• E)Everyone needs money, but not everyone needs steel.

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