1、 open market operations 4.The_ was created in 1913 in response to a series of economic depressions and failures. Its principal role is to serve as the lender of last resort and to stabilize the financial markets. Federal Reserve 5.The _ prevented banks from crossing state lines and made national ban
2、ks subject to the branching laws of their state. This act was later repealed by the Riegle Neal Interstate Banking law. McFadden-Pepper Act 6.Because the FDIC levies fixed insurance premiums regardless of risk, this leads to a problem called the _ among banks. The fixed premiums encourage all banks
3、to accept greater risk. moral hazard 7.In 1980, _ was passed and lifted government ceilings on deposit interest rates in favor of free market interest rates. DIDMCA 8.One tool that the Federal Reserve uses to control the money supply is _. The Federal Reserve will change the interest rate they charg
4、e for short term loans when they are using this tool of monetary policy. changing the discount rate 9.The first major federal banking law in the U.S. was the _. This law was passed during the Civil War and set up a system for chartering national banks and created the OCC. National Banking Act 10.The
5、_ was passed during the Great Depression. It separated investment and commercial banks and created the FDIC. Glass-Steagall Act 11.The_ brought bank holding companies under the jurisdiction of the Federal Reserve. Bank Holding Company Act 12.The_ allows bank holding companies to acquire banks anywhe
6、re in the United States. However, no one bank can control more than 30 percent of the deposits in any one state or more than 10 percent of the deposits across the country. Riegle-Neal Interstate Banking Act 13.The allows banks to affiliate with insurance companies and securities firms either through
7、 a holding company or as a subsidiary. Gramm-Leach-Bliley Act （Financial Services Modernization Act） 14.Customers of financial-service companies may _ of having their private information shared with a third party such as a telemarketer. However, in order to do this they must tell the financial-servi
8、ces company in writing that they do not want their personal information shared with outside parties. opt out 15.The federal bank regulatory agency which examines the most banks is the _. 16.The _ requires financial service companies to report suspicious activity in customer accounts to the Treasury
9、Department. U.S. Patriot Act 17.The central bank of the new European Union is known as the _. European Central Bank or ECB 18.The _ Act prohibits banks and other publicly owned firms from publishing false or misleading financial performance information. Sarbanes-Oxley 19. One of the main roles of th
10、e Federal Reserve today is . They have three tools that they use today to carry out this role; open market operations, the discount rate and legal reserve requirements. monetary policy20. The is the center of authority and decision making within the Federal Reserve. It consists of seven members appo
11、inted by the president for terms not exceeding 14 years. Board of Governors21. The main regulators of insurance companies are . state insurance commissions22. Federal Credit Unions are regulated and examined by . the National Credit Union Administration.23. The makes it easier for victims of identit
12、y theft to file fraud alerts and allows the public to apply for a free credit report once a year. Fair and Accurate Credit Transactions Act （FACT Act）24. The makes it faster and less costly for banks to clear checks. It allows for banks to electronically send check images instead of shipping paper c
13、hecks across the country. Check 21 Act25. The was created by the National Banking Act and is part of the Treasury Department. It is the primary regulator of National Banks. Office of the Comptroller of the Currency （OCC）26. The _ proposes various regulations applying to the financial markets to comb
14、at the recent credit crisis. This “bail-out” bill granted the US Treasury the means to purchase troubled loans, allowed the FDIC to temporarily increase deposit insurance, and permitted the government to inject additional capital into the banking system. The Emergency Economic Stabilization Act of 2
15、008True/False QuestionsTF27.Federal Reserve Act authorized the creation of the Federal Deposit Insurance Corporation. False TF28.In the United States, fixed fees charged for deposit insurance, regardless of how risky a bank is, led to a problem known as moral hazard. True TF28.Government-sponsored d
16、eposit insurance typically encourages individual depositors to monitor their banks behavior in accepting risk. TF29.The Federal Reserve changes reserve requirements frequently because the affect of these changes is so small. TF30.The Bank Merger Act and its amendments requires that Bank Holding Comp
17、anies be under the jurisdiction of the Federal Reserve. TF31.National banks cannot merge without the prior approval of the Comptroller of the Currency. TF32.The Truth in Lending （or Consumer Credit Protection） Act was passed by the U.S. Congress to outlaw discrimination in providing bank services to
18、 the public. TF33.The federal law that states individuals and families cannot be denied a loan merely because of their age, sex, race, national origin or religious affiliation is known as the Competitive Equality in Banking Act. TF34.Under the terms of the 1994 Riegle-Neal Interstate Banking law ban
19、k holding companies can acquire a bank anywhere inside the United States, subject to Federal Reserve Board approval. TF35.The 1994 federal interstate banking bill does not limit the percentage of statewide or nationwide deposits that an interstate banking firm is allowed to control. TF36.The term re
20、gulatory dialectic refers to the dual system of banking regulation in the United States and selected other countries where both the federal or central government and local governments regulate banks. TF37.The moral hazard problem of banks is caused by the fixed insurance premiums paid by banks and c
21、auses banks to accept greater risk. TF38.When the Federal Reserve buys T-bills through its open market operations, it causes the growth of bank deposits and loans to decrease. TF39.When the Federal Reserve increases the discount rate it generally causes other interest rates to decrease. TF40.The Nat
22、ional Bank Act （1863） created the Federal Reserve which acts as the lender of last resort. TF41.FIRREA （1989） allowed bank holding companies to acquire nonblank depository institutions and, if desired, convert them into branch offices. TF42.The Sarbanes-Oxley Act allows banks, insurance companies, a
23、nd securities firms to form Financial Holding Companies （FHCs）. TF43.The Gramm-Leach-Bliley Act of 1999 essentially repeals the Glass-Steagall Act passed in the 1930s. TF44.Passed in 1977, the Equal Credit Opportunity Act prohibits banks from discriminating against customers merely on the basis of t
24、he neighborhood in which they live. TF45.The tool used by the Federal Reserve System to influence the economy and behavior of banks is known as moral hazard. False TF46.One of the principal reasons for government regulation of financial firms is to protect the safety and soundness of the financial s
25、ystem. True Multiple Choice Questions47. Banks are regulated for which of the reasons listed below? A）Banks are leading repositories of the publics savings. B）Banks have the power to create money. C）Banks provide businesses and individuals with loans that support consumption and investment spending. D）Banks assist governments in conducting economic polic
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