Two institutions that were developed to provide banking stability in the United States after the great depression are FDIC insurance and efficient market hypothesis derivatives markets and the efficient market hypothesis FDIC insurance and a lender of last resort open capital markets and a nationalized banking industry

Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter12: Money, Banking And The Financial System
Section: Chapter Questions
Problem 15QP
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Two institutions that were developed to provide banking stability in the United States after the great depression are
FDIC insurance and efficient market hypothesis
derivatives markets and the efficient market hypothesis
FDIC insurance and a lender of last resort
open capital markets and a nationalized banking industry
While capital outflow might arise from desire to avoid falling domestic asset values, speculative attack is motivated by
profiting from expected depreciation of the currency
profiting from rising domestic asset values
private sector attempts to stabilize the economy when government institutions fail
racism against emerging markets
Bank runs are still a common problem in the United States
True
False
Contagion of crises can stem from both trade and financial linkages
True
False
The international community lacks a reliable lender of last resort
True
False
Transcribed Image Text:Two institutions that were developed to provide banking stability in the United States after the great depression are FDIC insurance and efficient market hypothesis derivatives markets and the efficient market hypothesis FDIC insurance and a lender of last resort open capital markets and a nationalized banking industry While capital outflow might arise from desire to avoid falling domestic asset values, speculative attack is motivated by profiting from expected depreciation of the currency profiting from rising domestic asset values private sector attempts to stabilize the economy when government institutions fail racism against emerging markets Bank runs are still a common problem in the United States True False Contagion of crises can stem from both trade and financial linkages True False The international community lacks a reliable lender of last resort True False
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