The rise in bank failures in the late 1980s and early 1990s occurred

Question

Quizplus · Accepted Answer

The rise in bank failures in the late 1980s and early 1990s occurred at state-chartered banks, which are less closely regulated than other banks. Many of these banks had lent heavily to the real estate market, which experienced a sharp decline, resulting in many bank failures. The federal deposit insurance regulation remained in place during this time, so choice B is incorrect. The Federal Reserve continued to monitor banks, so choice D is also incorrect. While the FDIC played a role in insuring failed banks, it was not the cause of the rise in bank failures, and choice E is therefore incorrect.

The Rise in Bank Failures in the Late 1980s and Early