Bank Regulation Exists Because Public Authorities Are Convinced That

question 33

Multiple Choice

Bank regulation exists because public authorities are convinced that

• A)the balance between public interest and safety does not affect profitability, and should be removed from the hands of managers.
• B)the balance between bank profitability and public interest cannot be handled with legislation, but can be handled with regulation.
• C)the balance between bank profitability and safety cannot be left to profit-maximizing managers.
• D)the balance between bank safety and public interest can best be obtained by reliance on the market.

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Definitions:

Economists

Researchers who explore the processes of making, moving, and consuming products and services in the economy.

Economic Activity

Activities related to the manufacturing, disseminating, and utilizing products and services in an economic system.

Fluctuations

Fluctuations refer to variations or changes in a condition, value, or level of economic variables over time.

Inflation

The escalation speed in general price levels of goods and services, ultimately leading to diminished power for making purchases.