Which of the Following Is NOT a Reason Financial Regulation

question 7

Multiple Choice

Which of the following is NOT a reason financial regulation and supervision is difficult in real life?

• A)Financial institutions have strong incentives to avoid existing regulations.
• B)Unintended consequences may happen if details in the regulations are not precise.
• C)Regulated firms lobby politicians to lean on regulators to ease the rules.
• D)Financial institutions are not required to follow the rules.

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Definitions:

Human Functioning

Refers to the ways in which individuals operate in their daily lives, encompassing physical, mental, emotional, and social aspects.

Networked Individualism

A social structure wherein individuals operate in networks of relationships rather than bounded social groups, facilitated by digital communication technologies.

Online Environments

Virtual spaces facilitated by the internet where individuals can interact, share information, and participate in various activities.

Empirical Grounding

The basis of knowledge or theory through observation and experience rather than purely theoretical or abstract reasoning.