Bank Regulators Impose Capital Requirements in Order to

question 369

Multiple Choice

Bank regulators impose capital requirements in order to

• A)increase the amount of leverage in the economy.
• B)provide an incentive for banks to hold risky assets.
• C)ensure banks can pay off depositors.
• D)increase the probability of a credit crunch.

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Definitions:

Chi-square Test

A statistical procedure employed to evaluate whether a significant correlation exists between two variables that are categorical.

Minimum

The smallest or least amount allowable or possible in a given set of circumstances.

Maximum

The largest value in a given set of numbers or data points.

Range

The difference between the highest and lowest values in a dataset, offering a simple measure of data spread.