The Primary Purpose of Deposit Insurance Is to

question 54

Multiple Choice

The primary purpose of deposit insurance is to

• A)improve the flow of information to investors.
• B)prevent banking panics.
• C)protect bank shareholders against losses.
• D)protect bank employees from unemployment.

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Definitions:

Current Asset Financing

A strategy involving the use of short-term credit to finance the ongoing operations and current assets of a business.

Net Working Capital

The difference between a company's current assets and its current liabilities.

Flexible Policy

A strategy that allows for adaptability and change in response to different situations or conditions.

Restrictive Policy

A financial or operational strategy that limits certain actions to control risk or enhance stability within a company or economy.