Reading 24: Money, Banks, and the Federal Reserve - LOS c, class, banking, occurred, following, 2008

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1.Which of the following is the most accurate with regard to the result of banking deregulation that occurred in the U.S. during the 1980s?

A)   There is a clearer distinction between the functions of commercial banks on the one hand and thrift institutions on the other.

B)   Different types of depository institutions are now more similar in the products and services that they provide.

C)   Interest-bearing checkable deposits are no longer a major part of the M1 money supply.

D)   The emergence of a great number of small and local banks increased the efficiency of bank operations.

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答案和详解如下：

1.Which of the following is the most accurate with regard to the result of banking deregulation that occurred in the U.S. during the 1980s?

A)   There is a clearer distinction between the functions of commercial banks on the one hand and thrift institutions on the other.

B)   Different types of depository institutions are now more similar in the products and services that they provide.

C)   Interest-bearing checkable deposits are no longer a major part of the M1 money supply.

D)   The emergence of a great number of small and local banks increased the efficiency of bank operations.

The correct answer was B)

During the 1980s (and 1990s) many of the restrictions that made commercial banks different from savings banks and thrifts were relaxed, allowing the latter to compete more directly with the former, and allowed other institutions to participate in activities which were formerly only permitted to banks and savings institutions. Another area of deregulation was the repeal of earlier laws that restricted banks from opening branches nationwide. Permitting banks to open branch offices in any state has led to the consolidation of banks, the emergence of a few very large national banks, many mergers and acquisitions, and a resulting increase in the efficiency of bank operations.