Free Practice Question
CR · Critical Reasoning
655-705
Complete the Passage
.
Which of the following best completes the passage below? As long as savings accounts are protected by federal insurance, account holders will have no reason to assess the stability of a savings institution. Interest rates alone will dictate their choice of institution. To draw in more deposits, banks will need to provide the highest possible interest rates. And since offering higher rates can put a strain on the financial health of a bank, ______
Which of the following best completes the passage below? As long as savings accounts are protected by federal insurance, account holders will have no reason to assess the stability of a savings institution. Interest rates alone will dictate their choice of institution. To draw in more deposits, banks will need to provide the highest possible interest rates. And since offering higher rates can put a strain on the financial health of a bank, ______
Answer Choices
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(A) the federal government will likely need to set limits on interest rates
B
(B) deposit insurance may eventually cause the financial instability of several banks
C
(C) account holders will have to decide between deposit insurance and higher interest rates
D
(D) deposits will generally flow to the banks with the strongest financial positions
E
(E) bank revenues will likely increase to unprecedented levels
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R
RokoMay 4, 2025
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Details
Difficulty
655-705
Type
CR