Which of the Following Is a Government Regulation That Enables

question 62

Multiple Choice

Which of the following is a government regulation that enables the government to achieve its goals for the banking system?​

• A)​A government regulation that allows for mergers in order to help increase the size of a bank.
• B)​A government regulation that provides complete discretion to banks to manage the supply of money.
• C)​Banks are required to hold reserves in order to control the money supply.
• D)​Banks are penalized in case of inefficient functioning.

Identify the reasons for holding cash and the concept of precautionary demand for cash.

Understand how lockbox systems and float management can improve a firm’s cash management.

Recognize the trade-offs involved in carrying either too much or too little cash.

Grasp the financial implications of different short-term financing options and cash management practices.

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Definitions:

Subjective Norms

Individual beliefs about whether people important to them approve or disapprove of a specific behavior, influencing their intentions and actions.

Peer Pressure

The influence exerted by a peer group in encouraging a person to change their attitudes, values, or behaviors to conform to group norms.

Descriptive Norm

Social norms that describe what is typically done in a given context, influencing individuals' behavior by providing information about what is considered normal or typical behavior.

Consistency Motive

The desire to maintain uniformity in one's attitudes, beliefs, and behaviors over time.