Nationwide Banking Might Reduce Bank Failures Due to

question 10

Multiple Choice

Nationwide banking might reduce bank failures due to

• A)reduced competition.
• B)reduced lending to small businesses.
• C)diversification of loan portfolios across state lines.
• D)elimination of community banks.

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Definitions:

Equilibrium

A situation in which the market price has reached the level at which quantity supplied equals quantity demanded.

Money Demanded

The total amount of money that households and businesses want to hold at a given time, often influenced by interest rates, income levels, and the economic outlook.

Federal Reserve

The central banking system of the United States, responsible for monetary policy, regulation of banks, and ensuring stability of the financial system.

Federal Funds Rate

The rate at which banks exchange federal funds (balances maintained at Federal Reserve Banks) among themselves for overnight loans.