Questions from Financial Markets

Q: How do disclosure requirements help limit excessive risk taking by banks?

How do disclosure requirements help limit excessive risk taking by banks?

Q: How could higher deposit insurance premiums for banks with riskier assets benefit

How could higher deposit insurance premiums for banks with riskier assets benefit the economy?

Q: How could market-value accounting for bank capital requirements (discussed

How could market-value accounting for bank capital requirements (discussed in the first Web appendix to this chapter) benefit the economy? How difficult would it be to implement?

Q: A lottery claims its grand prize is $10 million, payable

A lottery claims its grand prize is $10 million, payable over 20 years at $500,000 per year. If the first payment is made immediately, what is this grand prize really worth? Use an interest rate of 6%...

Q: If casualty insurance companies provided fire insurance without restrictions, what kind

If casualty insurance companies provided fire insurance without restrictions, what kind of adverse selection and moral hazard problems might result?

Q: What bank regulation is designed to reduce adverse selection problems for deposit

What bank regulation is designed to reduce adverse selection problems for deposit insurance? Will it always work?

Q: What bank regulations are designed to reduce moral hazard problems created by

What bank regulations are designed to reduce moral hazard problems created by deposit insurance? Will they eliminate the moral hazard problem?

Q: What are the costs and benefits of a too-big-

What are the costs and benefits of a too-big-to-fail policy?

Q: What special problem do off-balance-sheet activities present to

What special problem do off-balance-sheet activities present to bank regulators, and what have they done about it?

Q: What forms does bank supervision take, and how do they promote

What forms does bank supervision take, and how do they promote a safe and sound banking system?