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False 35 under the terms of the 1994 riegle neal

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FALSE35.Under the terms of the 1994 Riegle-Neal Interstate Banking and Branching Efficiency Act, adequatelycapitalized and managed bank holding companies can acquire a bank anywhere inside the United States.TRUE36.The 1994 Federal Interstate Banking bill does not limit the percentage of statewide or nationwide depositsthat an interstate banking firm is allowed to control.FALSE37.The term "regulatory dialectic" refers to the dual system of banking regulation in the United States andselected other countries where both the federal or central government and local governments regulate banks.FALSE38.The moral hazard problem of banks is caused by the fixed insurance premiums paid by banks which makethem accept greater risk.TRUE39.When the Federal Reserve buys T-bills through its open market operations, it causes the growth of bankdeposits and loans to decrease.FALSE40.When the Federal Reserve increases the discount rate, it generally causes other interest rates to decrease.FALSE41.The National Bank Act (1863-64) created the Federal Reserve which acts as the lender of last resort.FALSE42.The Financial Institutions Reform, Recovery, and Enforcement Act (1989) allowed bank holdingcompanies to acquire nonbank depository institutions and, if desired, convert them into branch offices.TRUE43.The Sarbanes-Oxley Act allows banks, insurance companies, and securities firms to form FinancialHolding Companies (FHCs).
FALSE44.The Gramm-Leach-Bliley Act of 1999 essentially repeals the Glass-Steagall Act passed in the 1930s.TRUE45.Passed in 1977, the Equal Credit Opportunity Act prohibits banks from discriminating against customersmerely on the basis of the neighborhood in which they live.FALSE46.The tool used by the Federal Reserve System to influence the economy and behavior of banks is known asmoral hazard.FALSE47.One of the principal reasons for government regulation of financial firms is to protect the safety andsoundness of the financial system.TRUEMultiple Choice Questions48.Banks are regulated for which of the reasons listed below?A.Banks are leading repositories of the public's savings.B.Banks have the power to create money.C.Banks provide businesses and individuals with loans that support consumption and investment spending.D.Banks assist governments in conducting economic policy, collecting taxes, and dispensing government payments.E.All of the options are correct.
49.An institutional arrangement in which federal and state authorities both have significant bank regulatorypowers is referred to as:A.balance of power.B.federalism.C.dual banking system.D.cooperative regulation.E.coordinated control.50.The law that set up the federal banking system and provided for the chartering of national banks was the:A.National Bank Act.

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Term
Fall
Professor
Trish
Tags
The Land, Bank Management and Financial Services

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