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A Banking Industry with a Large Number of Small Banks

Question 61

Multiple Choice

A banking industry with a large number of small banks competing against each other in the market would be described as competitive. This type of market structure would


A) encourage behavior beneficial to consumers.
B) be characterized by inefficiencies and fewer benefits for the public.
C) increase the likelihood of an individual bank failure because of the increased level of competition.
D) Both a and c are correct.

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