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15. Which of the following is NOT correct about the crisis? a) A banking crisis occurred when there is a sharp increase in NPLs in

15. Which of the following is NOT correct about the crisis?

a) A banking crisis occurred when there is a sharp increase in NPLs in banking sector leading to substantial losses beyond the capital in banking system

b) A sovereign debt crisis is when a sovereign is unable to meet its liabilities

c) There is a clear definition of crisis

d) Crisis involved real crisis and pseudo crisis

e) None of the above

16. Which of the following is correct about the consequences of banking crisis?

a) Available credit in an economy decreases as bank fail

b) The negative impact on the banking sector can spill over to other economies

c) Borrower-lender relationship break during banking crisis leading to decrease in borrowing cost

d) a) and b) of the above

e) a) b) and c) of the above

17. Which of the following is NOT correct about the bank run?

a) Banking crisis are mostly preceded by bank run

b) Bank runs occur only when there is a clear sign of economic downturn

c) Burst of asset price bubbles can lead to bank runs

d) b) and c) of the above

e) none of the above

18. Home equity in relation to mortgage loan market refers to

a) The difference between the current market price of the mortgaged house and the remaining amount in the mortgage loan.

b) The difference between the purchase price of the mortgaged house and the

remaining amount in the mortgage loan.

c) The difference between the face value of the mortgage loan and the remaining amount in the mortgage loan.

d) The difference between the purchase price and the current market price of the mortgaged house.

e) None of the above is true

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