Accounting Multiple Choice Question – 20 April 2025

The USA is often referred to as being a market-based financial system.

Consequently, its financial system will be characterised by?

Select ONE answer:

1. Comparatively more government regulation than a bank-based system
2. Comparatively fewer close relationships between banks and businesses than in a bank-based system
3. Comparatively more risk adverse households than in a bank-based system
4. Households with less access to investment in physical assets than in a bank-based system

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct == > (1), (3) and (4) are all characteristics of bank-based financial systems.
3. Not correct
4. Not correct

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