One of the Lessons from the 2007-2009 Financial Crisis Regarding

question 91

Multiple Choice

One of the lessons from the 2007-2009 financial crisis regarding the management of risk by financial institution is that:

• A) many banks lacked real-time information that would allow them to assess their various risk exposures at the bank-wide level.
• B) some banks, especially large ones, overestimated the trading risk associated with mortgage backed securities.
• C) banks were holding too much capital as a protection against market risk.
• D) many of the usual mechanisms for managing liquidity risk actually worked pretty well.

---

Definitions:

Cost-Responsiveness Efficient Frontier

A concept in supply chain management indicating the optimal point where the cost of providing a certain level of responsiveness is minimized.

Supply Chain Efficiency

The optimization of a company's supply-side activities to maximize customer value and gain a competitive advantage in the market.

Responsiveness Spectrum

Describes the range of a company's ability to respond to changes in demand, supply chain disruptions, and market trends quickly and effectively.

Zone of Strategic Fit

A concept in supply chain management that emphasizes the alignment between the supply chain strategy and the competitive strategy of the company.