#1
Which organization is responsible for overseeing the implementation of monetary policy in the United States?
Federal Reserve System (Fed)
ExplanationThe central bank of the United States, responsible for monetary policy implementation.
#2
What does the term 'SRO' stand for in financial regulation?
Self-Regulatory Organization
ExplanationAn organization that creates and enforces rules and standards within a specific industry or profession.
#3
Which of the following is NOT a role typically performed by a securities regulator?
Setting monetary policy
ExplanationSecurities regulators focus on overseeing securities markets and protecting investors, not setting monetary policy.
#4
What is the purpose of the Financial Industry Regulatory Authority (FINRA) in the United States?
To regulate the securities industry
ExplanationMaintains fair and efficient securities markets by regulating brokerage firms and exchange markets.
#5
Which of the following is NOT a key principle of sound financial regulation?
Market speculation
ExplanationSound financial regulation emphasizes stability, transparency, and investor protection, not speculation.
#6
Which of the following is NOT a function of a central bank?
Enforcing antitrust laws
ExplanationAntitrust laws enforcement is typically handled by separate regulatory bodies.
#7
What does 'LIBOR' stand for in financial markets?
London Interbank Offered Rate
ExplanationA benchmark interest rate at which banks lend to one another in the international market.
#8
Which of the following is an example of a regulatory measure aimed at preventing market manipulation?
Short-selling restrictions
ExplanationImposes limits on selling borrowed securities to prevent artificially driving down prices.
#9
What is the primary objective of the Dodd-Frank Wall Street Reform and Consumer Protection Act?
To strengthen consumer protections
ExplanationEnhances financial stability and consumer protections in response to the financial crisis of 2007-2008.
#10
Which of the following is an example of a macroprudential regulation?
Capital adequacy requirements
ExplanationMeasures aimed at ensuring the stability of the entire financial system.
#11
Which regulatory body is responsible for supervising and regulating banks within the European Union?
European Banking Authority (EBA)
ExplanationEnsures the stability and integrity of the European banking sector.
#12
Which of the following is NOT a component of Basel III banking regulations?
Credit rating agency oversight
ExplanationBasel III focuses on capital adequacy, liquidity, and stress testing, not oversight of credit rating agencies.
#13
What does the 'Volcker Rule' prohibit banks from engaging in?
Proprietary trading
ExplanationRestricts banks from making certain speculative investments with their own accounts.
#14
What does the acronym 'SEC' stand for in the context of financial regulation in the United States?
Securities and Exchange Commission
ExplanationOversees securities markets and protects investors.
#15
What is the main purpose of the Financial Stability Board (FSB)?
To coordinate global financial regulation
ExplanationCoordinates international financial regulation to enhance global financial stability.