Which of the Following Agreements Is Included in the Basel

question 7

Multiple Choice

Which of the following agreements is included in the Basel III Accord (2010) ?

• A)Agreement to increase banks' capital (owners' equity) requirements in an effort to reduce the risk that mega bank failures will cause future financial crises
• B)Agreement to put restrictions on the ability of the U.S. government to use taxpayers' funds to bail out large financial institutions
• C)Agreement to create new organizations to help provide consumers clear and accurate information related to credit so that better-informed decisions can be made
• D)Agreement to permit the U.S. government to purchase up to $700 billion in troubled mortgages in an attempt to improve liquidity in the financial markets
• E)Agreement to limit the salaries of executives whose companies received Troubled Asset Relief Program (TARP) funds.

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Definitions:

Efficiency

The extent to which resources are allocated in the most effective manner, maximizing output from a set of inputs.

Equity

Equity refers to fairness or justice in the way people are treated and is often considered in economic and legal contexts to ensure fair distribution of resources and opportunities.

Economic Theory

A framework or system of ideas that explains and analyzes the production, distribution, and consumption of goods and services.

Spending

The amount of money expended by individuals, businesses, or governments on goods and services.