One Enduring Truth of Banking Is That

question 93

Multiple Choice

One enduring truth of banking is that

• A)for some reason, bankers always seem willing to lend huge amounts to borrowers with a limited potential to repay.
• B)credit ratings work, but only in the aggregate.
• C)when liquidity dries up, bankers are typically able to ride out the storm by buying up other investors debt at pennies on the dollar, holding it until the crisis is over, and then selling at a huge profit.
• D)none of the above

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Definitions:

Discriminative Stimulus

A stimulus that signals whether a certain response or behavior is likely to be rewarded, ignored, or punished.

Unconditioned Stimulus

In classical conditioning, a stimulus that naturally and automatically triggers a response without prior learning.

White Rat

Often used in psychological experiments, a specific breed of rat distinguished by its albino coloration.

Modern Conceptualization

The current understanding or interpretation of an idea, theory, or system based on contemporary perspectives or data.