NO NEED EXPLANATION. JUST MCQ BEST OPTION

Q1) Effective regulation of financial institutions is required at an international level because that would

a.

Help avoid a credit crunch that would make it difficult for business and consumers to borrow from the banks.

b.

Help ensure the stability of the global financial system

c.

Regulate banks in their domestic and their foreign operations

d.

All of the options above

Q2) The securitization process can only be applied to mortgages and not to other types of loans such as student loans.

Select one:

True

False

Q3) Initial conditions in the year before the crisis in Thailand, Indonesia, Malaysia, the Philippines, and Korea in 1997 indicate that

Icapital inflows/GDP were very low.

IInonperforming bank loan ratios were high.

IIIcurrent account deficits were high.

IVcredit growth was fast.

a.

II and III only

b.

I and IV only

c.

I, II, and III only

d.

II, III and IV only

Q4) When the dollar sharply strengthened relative to yen and the EU currencies in 1995, it led to an appreciation of the Asian currencies that were pegged to the dollar.

Select one:

True

False

Q5) Which of the following are characteristic of the period when financial bubbles burst?

a.

Rising share prices

b.

Stable house prices

c.

Excessive pessimism about future asset prices.

d.

Excessive optimism about future asset prices.