The Following Are Protective Mechanisms That Have Been Developed by Regulators

question 29

Multiple Choice

The following are protective mechanisms that have been developed by regulators to promote the safety and soundness of the banking system except:

• A)encouraging banks to rely more on deposits rather than debt or capital as a cushion against failure
• B)encouraging banks to limit lending to a single customer to no more than 10 per cent of capital
• C)the provision of deposit insurance
• D)the periodic monitoring of banks

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Definitions:

Frontloading

The practice of placing the most important information at the beginning of a communication to ensure it is seen or heard first.

Main Idea

The central or most important theme, point, or argument that a piece of writing, speech, or discussion seeks to convey.

Block Style

A format used in business and formal writing, where text is aligned to the left margin, and paragraphs are not indented but separated by a blank line.

Business Letters

Written communications on official company letterhead intended for formal purposes and external affairs.