Which of the Following Is NOT a Reason That Firms

question 96

Multiple Choice

Which of the following is NOT a reason that firms in the shadow banking system were more vulnerable than commercial banks during the financial crisis of 2007-2009?

• A) They could invest in riskier assets.
• B) Investors had no insurance against loss of principal.
• C) They made investments that would lose value if housing prices decline.
• D) They were more heavily regulated than commercial banks, making them less able to adjust to changing market conditions.

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Definitions:

Erikson

Refers to Erik Erikson, a psychologist known for his theory on the psychosocial development of individuals across the lifespan.

Intimacy Versus Isolation

Erikson’s sixth psychosocial stage in which individuals demonstrate the capacity to feel closeness and bond with another individual to make a permanent commitment to a romantic partner.

Romantic Partner

An individual with whom one shares a significant, often affectionate or loving, relationship.

Stepparents

Adults who become parents through marrying or partnering with individuals who have children from a previous relationship, rather than biologically.