Other questions in this quiz

2. Which of the following statements are true in relation to Basel III? A. It is relevant to "systemically important" institutions only, due to their role in the financial crisis. B. It included new ratios related to liquidity and leverage requirements

  • A, B, & C only
  • B, C, & D only
  • A & B only
  • B & D only
  • as the Basel II requirements were deemed to be sufficient. D. It sets out disclosure requirements for banks.

3. Which of the following describes a situation when an institution insulated from risk behaves differently than it would behave if it were fully exposed to the risk?

  • Adverse selection
  • Moral hazard
  • Moral selection
  • Adverse hazard

4. Which of the following is responsible for setting out global capital adequacy requirements?

  • International Monetary Fund
  • Basel Committee on Banking Supervision
  • Financial Stability Board
  • World Bank

5. Which of the following statements is true in relation to principal-agent problems?

  • They arise when the interests of banks and their customers are closely aligned.
  • They refer to ways in which the asymmetric relationship between banks and their customers can affect the value of transactions.
  • They refer to the way in which state intervention increases the potential for adverse behavior by a bank.

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