A long-standing goal of financial regulators has been to:
A) prevent banks from growing too big and powerful.
B) minimize the competition that banks face.
C) encourage banks to grow as large as possible.
D) discourage small rural banks.

Question

Quizplus · Accepted Answer

Financial regulators aim to prevent banks from growing too big and powerful because such banks can pose a systemic risk to the financial system in the event of their collapse. The 2008 financial crisis, for example, was attributable in part to the excessive risk-taking of large banks. Therefore, preventing banks from becoming too large is a critical objective of the regulators.

A Long-Standing Goal of Financial Regulators Has Been To