The ECB would be unable to prevent a large banking crisis in the Eurozone because:
A) it can print money but is prohibited from lending to banks or central banks in the member states.
B) crises of such proportions would require an international effort.
C) deposits in banks in the Eurozone have FDIC insurance and are therefore out of the control of the ECB.
D) its assets are inadequate.
Ans: A) it can print money but is prohibited from lending to banks or central banks in the member states.
You might also like to view...
Suppose the government cuts taxes. We would expect interest rates to ________ and the dollar to ________ in foreign exchange markets
A) rise; appreciate B) fall; depreciate C) rise; depreciate D) fall; appreciate
In swap transactions, the trader is interested in
A) the difference between spot and forward rates. B) only the spot rate. C) only the forward rate. D) both the spot and deposit interest rate.