The too-big-to-fail policy
A) reduces moral hazard problems.
B) puts large banks at a competitive disadvantage in attracting large deposits.
C) treats large depositors of small banks inequitably when compared to depositors of large banks.
D) allows small banks to take on more risk than large banks.
C
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Suppose there is a bank panic. Which of the following would not be a consequence of this bank panic?
A) Individual banks would have to shrink the value of loans they made. B) The economy would likely enter into a recession. C) Bank total reserves would decrease. D) Bank checking account balances would decrease. E) Required reserves would increase.
The opportunity cost of producing in low-income, developing countries rises over the product cycle, according to theory
Indicate whether the statement is true or false