If the Government Guarantees Not Only the Deposits but Also

question 112

Multiple Choice

If the government guarantees not only the deposits but also the other liabilities of a failing bank, the government usually:

• A)temporarily takes over the bank but then reprivatizes it as soon as possible.
• B)merges it with the Treasury.
• C)merges it with the Federal Reserve.
• D)closes the bank permanently.

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Definitions:

Balance Sheet

A financial statement that displays a company's financial position at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Income Statement

A financial report that shows a company's revenues, expenses, and net income over a specific period.

Investee

A company or entity in which an investment is made, typically signifying a minority interest.

Progressives

Advocates for social reform and political change aimed at improving the conditions and fairness of society, historically seen in movements for labor rights, suffrage, and elimination of corruption.