Author Question: With of the following is true with regard to leverage? a. The U.S.banking system uses very little ... (Read 45 times)

silviawilliams41 · **on:** Jun 30, 2018

With of the following is true with regard to leverage?
a. The U.S.banking system uses very little leverage to ensure the safety of the banking system.
b. Leverage in the banking system increases its potential for profits, but no losses.
c. Losses borne by highly leveraged banks can have a ripple effect throughout the financial system.
d. All of the above are true

Question 2

Which of the following techniques adopted by the central banks around the world have helped them to achieve credibility?
a. Maintaining a low rate of inflation through tight monetary policies
b. Publicly announcing a target rate of inflation
c. Refusing to bail out the commercial banks at times of failure
d. Supporting all government budget deficits through deficit financing
e. Reducing unemployment amidst high inflation