What Was the Objective of the FDIC Improvement Act (FDICIA)

question 96

Multiple Choice

What was the objective of the FDIC Improvement Act (FDICIA) of 1991?

• A)Returning the banking industry to record profit levels.
• B)Restructure the savings association deposit insurance fund and transfer its management to FDIC.
• C)To deny deposit insurance coverage to funds obtained through deposit brokers.
• D)To restructure the bank deposit insurance fund and prevent its potential insolvency.
• E)To enforce the capital standards on insured depository institutions.

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Definitions:

Corporate Income Tax

A tax on the income or profit of corporations, which contributes to government revenue.

Gross Investment

The total amount of money spent on capital goods, or assets intended to produce future income, not accounting for depreciation.

Net Investment

The total amount spent on capital assets, like buildings and machinery, minus depreciation. It reflects the increase in the value of physical assets.

Depreciation

The gradual decrease in the economic value of the capital assets of a firm or nation due to wear and tear, obsolescence, or age, often accounted for in financial statements through depreciation expense.