Question 1

The following questions apply to the following simplified bank balance sheet
  
-The Bank above suffers a 50% fall in the value of its loans.It is now

Accepted Answer

A)  in a position where none of its creditors will get any of their money back 
B)  effectively bankrupt and depositors stand to lose money 
C)  effectively bankrupt but depositors can be paid off 
D)  effectively bankrupt but depositors and subordinated debt holders can be paid off 
E)  still a viable enterprise but with dramatically reduced capital 
A)  in a position where none of its creditors will get any of their money back 
B)  effectively bankrupt and depositors stand to lose money 
C)  effectively bankrupt but depositors can be paid off 
D)  effectively bankrupt but depositors and subordinated debt holders can be paid off 
E)  still a viable enterprise but with dramatically reduced capital

Question 2

The key source of finance for small and medium size firms in most countries is

Accepted Answer

A)  Venture capital companies 
B)  Private financing companies 
C)  Financial markets 
D)  Public institutions 
E)  Banks 
A)  Venture capital companies 
B)  Private financing companies 
C)  Financial markets 
D)  Public institutions 
E)  Banks

Question 3

If a Bank is characterized by economies of scale,this means that the average cost,per unit,of providing its services

Accepted Answer

A)  increases as the quantity of services provided increases 
B)  decreases as the quantity of services provided increases 
C)  increases as the number of banks decrease 
D)  decreases as the number of banks increase 
E)  is unrelated to bank size or number 
A)  increases as the quantity of services provided increases 
B)  decreases as the quantity of services provided increases 
C)  increases as the number of banks decrease 
D)  decreases as the number of banks increase 
E)  is unrelated to bank size or number

Question 4

Capital adequacy regulations are designed to

Accepted Answer

A)  ensure banks' capital expenditure is adequate 
B)  ensure deposit insurance is sufficient 
C)  ensure that banks have sufficient equity and subordinated debt to absorb losses 
D)  ensure that banks are regularly inspected by bank regulators 
E)  ensure that the Bank's share capital is not concentrated in the hands of just a few shareholders 
A)  ensure banks' capital expenditure is adequate 
B)  ensure deposit insurance is sufficient 
C)  ensure that banks have sufficient equity and subordinated debt to absorb losses 
D)  ensure that banks are regularly inspected by bank regulators 
E)  ensure that the Bank's share capital is not concentrated in the hands of just a few shareholders

Question 5

A Credit Crunch is when

Accepted Answer

A)  Central Banks tighten credit conditions too much 
B)  interest rate are too high 
C)  borrowers find it hard to access credit due to restricted supply by lenders 
D)  Central Banks dramatically increase the supply of money 
E)  several banks fail at once 
A)  Central Banks tighten credit conditions too much 
B)  interest rate are too high 
C)  borrowers find it hard to access credit due to restricted supply by lenders 
D)  Central Banks dramatically increase the supply of money 
E)  several banks fail at once

Question 6

A bank is termed 'too big to fail' when

Accepted Answer

A)  it is of such economic importance that the government cannot allow it to fail 
B)  it is so large and profitable that failure is very unlikely 
C)  it is spread across so many countries, it cannot fail in any one country 
D)  it has enough money to pay off all its debts 
E)  all of the above 
A)  it is of such economic importance that the government cannot allow it to fail 
B)  it is so large and profitable that failure is very unlikely 
C)  it is spread across so many countries, it cannot fail in any one country 
D)  it has enough money to pay off all its debts 
E)  all of the above

The following questions apply to the following simplified bank balance sheet -The Bank above suffers a 50% fall in the value of its loans.It is now

The key source of finance for small and medium size firms in most countries is

If a Bank is characterized by economies of scale,this means that the average cost,per unit,of providing its services

Capital adequacy regulations are designed to

A Credit Crunch is when

A bank is termed 'too big to fail' when

What Is Macroeconomics

The Language of Macroeconomicsthe National Income Accounts

The Wealth of Nationsthe Supply Side

Capital Accumulation and Economic Growth

Total Factor Productivity, human Capital, and Technology

Endogenous Growth and Convergence

Unemployment and the Labor Market

International Trade

Globalization

Consumption Investment

Business Cycles

Money and Prices

Monetary Policy

Fiscal Policy and the Role of Government

Stabilization Policy

Financial Markets: Equities and Bonds

Sovereign Debt and Default

Exchange Rate Determination I the Real Exchange Rate

Exchange Rate Determination Iinominal Exchange Rates and Asset Markets

Currency Crises and Exchange Rate Systems

Filters

Exam 17: The Banking Sector

The following questions apply to the following simplified bank balance sheet -The Bank above suffers a 50% fall in the value of its loans.It is now

The key source of finance for small and medium size firms in most countries is

If a Bank is characterized by economies of scale,this means that the average cost,per unit,of providing its services

Capital adequacy regulations are designed to

A Credit Crunch is when

A bank is termed 'too big to fail' when

What Is Macroeconomics

The Language of Macroeconomicsthe National Income Accounts

The Wealth of Nationsthe Supply Side

Capital Accumulation and Economic Growth

Total Factor Productivity, human Capital, and Technology

Endogenous Growth and Convergence

Unemployment and the Labor Market

International Trade

Globalization

Consumption Investment

Business Cycles

Money and Prices

Monetary Policy

Fiscal Policy and the Role of Government

Stabilization Policy

Financial Markets: Equities and Bonds

Sovereign Debt and Default

Exchange Rate Determination I the Real Exchange Rate

Exchange Rate Determination Iinominal Exchange Rates and Asset Markets

Currency Crises and Exchange Rate Systems

Filters