The financial crisis of 2007-2009 has made which of the following regulatory goals a top priority for government:
A) disclosure of accounting information.
B) minimum capital requirements.
C) avoidance of systemic risk.
D) promotion of competition.

Question

Quizplus · Accepted Answer

The financial crisis of 2007-2009 revealed the risk of interconnectedness within the financial system which resulted in the collapse of several large financial firms. Hence, avoidance of systemic risk has become a top regulatory goal for governments to prevent such incidents in the future through measures such as stress tests, capital buffers, and regulation of systemic institutions. Disclosure of accounting information, minimum capital requirements, and promotion of competition are also important regulatory goals, but they may not necessarily help prevent systemic risks.

The Financial Crisis of 2007-2009 Has Made Which of the Following