Which of the following statements is false?

Question

BlackTom AI · Accepted Answer

Let's examine each statement to identify which one is false.

Option a: The major downside of managed investment funds is the fees that investors must pay. This is generally true in many contexts, as management fees, expense ratios, and other costs can erode returns, which is a common criticism of actively managed funds and some mutual funds.

Option b: Regulators cannot impose liquidity requirements on financial institutions. In reality, regulators do have tools to impose liquidity requirements, such as liquidity coverage ratios and other stress-testing or buffer requirements for banks and other financial institutions. Therefore, this statement is false because it contradicts established regulatory practice.

Option c: Under the regulatory rules, the amount of capital a bank must hold reflects the composition of its assets. This is true in many regulatory frameworks: different asset types carry different risk weights, and capital requirements adjust to asset risk and composition to safeguard solvency.

Option d: Only licensed banks are permitted to use the term 'bank' in their name. This is generally true in many jurisdictions where legal recognition and licensing govern naming rights, preventing non-banks from using the term in their branding to avoid consumer confusion.

In summary, while options a, c, and d align with common financial regulation concepts, option b conflicts with the reality that regulators can and do impose liquidity requirements on financial institutions.

Which of the following statements is false?单项选择题

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