One Reason That Financial Regulations Restrict the Assets That Banks

question 13

Multiple Choice

One reason that financial regulations restrict the assets that banks can own is to:

• A) combat the moral hazard that government safety nets provide.
• B) limit the growth rate of banks.
• C) prevent banks from being too profitable.
• D) keep banks from spending lavishly on perks for executives.

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Definitions:

Stratosphere

The stratosphere is the second major layer of Earth's atmosphere, located above the troposphere and characterized by a temperature inversion with altitude.

Hydrocarbons

Organic compounds consisting entirely of hydrogen and carbon, found in fossil fuels and used as a primary energy source and raw material in chemical manufacturing.

Suspended Particles

Tiny solid or liquid particles that are suspended in air or water, which can be harmful to human health and the environment when inhaled or ingested.

Pollutants

Substances introduced into the environment that cause harm or discomfort to the ecosystem or living organisms, including chemicals, waste materials, and noise.