The So-Called Too-Big-To-Fail Policy Has Two Conflicting Sides: on One

question 46

Multiple Choice

The so-called too-big-to-fail policy has two conflicting sides: on one hand there's the moral hazard problem that it creates, but in the other hand the Fed must:

• A) Protect the stability of the banking system
• B) Promote competition among banks
• C) Ensure the employment of people in financial services
• D) Control the money supply

---

Definitions:

Scale of Measurement

A system that specifies the nature of the relationship among values assigned to objects or individuals based on properties.

Achievement Test Scores

Quantitative measures of an individual's knowledge or proficiency in a particular subject or skill area, derived from standardized tests.

Standard Deviation

A measure used in statistics to quantify the amount of variation or dispersion of a set of values.

Percentile Rank

A score that indicates the percentage of scores in its frequency distribution that are equal to or below it.