Capital Requirements for Banks Do NOT Serve the Purpose Of

question 34

Multiple Choice

Capital requirements for banks do NOT serve the purpose of:

• A) reducing a bank owner's incentive for excessive risk taking.
• B) offsetting the change in incentives caused by deposit insurance.
• C) putting to use the excess of a bank's assets over its deposits and other liabilities.
• D) reducing deposits.

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Definitions:

Trust

The confidence in the reliability, truth, ability, or strength of someone or something, often built over time through consistent actions.

Self-disclosure

The act of sharing personal, private, or sensitive information with others to foster intimacy or trust.

Appropriate Time

The most suitable or optimal moment to carry out an action or event.

Self-description

The process by which individuals convey their own attributes, characteristics, and experiences through verbal or written communication.