The practice of the ECB and national central banks of preventing massive bank failures after the financial crisis of 2008 had what effect on the affected economies?
A) Prevention of bank failures greatly reduced the pain of the crisis for taxpayers.
B) Prevention of bank failures ended up not saving most banks anyway.
C) Banks resisted the takeover by the ECB and refused to make additional credit available.
D) Governments financed the bailouts by issuing more domestic debt, which caused extreme fiscal problems.
Ans: D) Governments financed the bailouts by issuing more domestic debt, which caused extreme fiscal problems.
You might also like to view...
Which of the following generalizations about the burden of an excise tax is correct?
a. The more inelastic the supply of a product, the larger the portion of an excise tax will be paid by buyers. b. The more inelastic the demand for a product, the larger the portion of an excise tax will be paid by buyers. c. The more elastic the supply of a product, the smaller the portion of an excise tax will be paid by buyers. d. The burden of an excise tax on a product is independent of the elasticity of the supply and demand for the product on which the tax is levied.
You own a building that has four possible uses: a cafe, a craft store, a hardware store, and a bookstore. The value of the building in each use is $2,000; $3,000; $4,000; and $5,000, respectively. You decide to open a hardware store. The opportunity cost of using this building for a hardware store is
A. $3,000, the value if the building is used as a craft store. B. $2,000, the value if the building is used as a cafe. C. $10,000, the sum of the values if the building is used for a cafe, a craft store, or a bookstore. D. $5,000, the value if you rented the building to someone else to use as a bookstore.