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The Financial System Is Inherently More Unstable Than Most Other

Question 4

Multiple Choice

The financial system is inherently more unstable than most other industries due to the fact that:


A) while in most other industries customers disappear at a faster rate, in banking they disappear slowly so the damage is done before the real problem is identified.
B) banks deal in paper profits, not in real profits.
C) a single firm failing in banking can bring down the entire system; this isn't true in most other industries.
D) there is less competition than in other industries.

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