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CIMAPRA17-BA1-1 Exam - Topic 1 Question 77 Discussion

Central banks inspect and sometimes set minimum limits on the reserves held by commercial banks. Which ONE of the following statements is NOT a reason that central banks seek to influence the reserves of commercial banks?
D) To prevent the collapse of the banking system
A) To influence commercial banks' ability to create credit
B) To avoid the commercial banks running out of liquidity
C) To regulate the profits of commercial banks

CIMAPRA17-BA1-1 Exam - Topic 1 Question 77 Discussion

Actual exam question for CIMA's CIMAPRA17-BA1-1 exam
Question #: 77
Topic #: 1
[All CIMAPRA17-BA1-1 Questions]

Central banks inspect and sometimes set minimum limits on the reserves held by commercial banks. Which ONE of the following statements is NOT a reason that central banks seek to influence the reserves of commercial banks?

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Suggested Answer: D

by Elli at Nov 25, 2023, 05:03 PM

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Sarina
10 months ago
They definitely want to avoid liquidity issues for banks.
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Rossana
10 months ago
Wait, are they really trying to prevent bank collapses? Sounds extreme!
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Chuck
10 months ago
I think regulating profits isn't really their goal, though.
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Cristal
10 months ago
Totally agree, it's all about liquidity management!
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Rikki
10 months ago
Central banks set reserve limits to control credit creation.
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Paris
10 months ago
I practiced a similar question where liquidity was a key factor, so B seems like a solid reason for central banks to intervene.
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Cory
11 months ago
D makes sense to me since preventing a banking collapse is crucial, but I feel like C could also be a trick answer.
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Yuki
11 months ago
I'm not really sure about C. Regulating profits seems a bit off compared to the other options.
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Kiley
11 months ago
I remember discussing how central banks influence credit creation, so I think A is definitely a reason they do this.
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Emile
11 months ago
I feel pretty confident about this one. The central bank's main goals are to influence credit creation and maintain financial stability, not to regulate the profits of commercial banks. I think option C is the answer.
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Brandon
11 months ago
Okay, let's see. The central bank wants to avoid commercial banks running out of liquidity and prevent the collapse of the banking system. So I'm guessing the answer that is not a reason is the one about regulating profits.
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Verdell
11 months ago
This one seems pretty straightforward. I think the key is to identify the reason that is not related to the central bank's goals of influencing commercial bank reserves.
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Alpha
11 months ago
Hmm, I'm a bit unsure about this one. I know the central bank wants to influence the commercial banks' ability to create credit, but I'm not sure if regulating their profits is also a reason. I'll have to think this through carefully.
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Abel
11 months ago
Hmm, this looks like a tricky one. I'll need to carefully review the relationships between the tables to determine which two extend from the Task table.
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Rickie
11 months ago
Hmm, I'm a bit unsure about this one. The requirements mention external IDs and customizable branding, so I'm not sure if the standard Azure AD options would be the right fit. I'll need to review the differences between the various Azure identity services.
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Martina
11 months ago
This is a good test of our understanding of SAML. The solution provides a clear explanation, so I'm going to go with option A. Knowing the difference between authentication and authorization is crucial for SAML.
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Edna
11 months ago
Brute force attacks, for sure. That's the whole point of account lockout - to stop automated attempts to guess passwords.
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Dean
1 year ago
Option C is the right answer, no doubt. Central banks have bigger fish to fry than worrying about commercial bank profits.
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Isaac
1 year ago
C) To regulate the profits of commercial banks
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Candra
1 year ago
B) To avoid the commercial banks running out of liquidity
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Marjory
1 year ago
A) To influence commercial banks' ability to create credit
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Sommer
1 year ago
Ha! Imagine a central bank being like, 'Yeah, we just want to make sure you guys aren't making too much money over there.' Definitely not the reason.
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Marci
1 year ago
D) To prevent the collapse of the banking system
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Linwood
1 year ago
C) To regulate the profits of commercial banks
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Delmy
1 year ago
B) To avoid the commercial banks running out of liquidity
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Oneida
1 year ago
A) To influence commercial banks' ability to create credit
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Ben
1 year ago
I'd go with Option C as the correct answer. Central banks are more concerned with financial stability, not commercial bank profits.
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Man
1 year ago
That makes sense, central banks want to ensure stability in the banking system.
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Yuki
1 year ago
I disagree, I believe the answer is D) To prevent the collapse of the banking system.
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Jean
1 year ago
Option C seems like a strange one. Regulating the profits of commercial banks? I don't think that's a primary reason for central bank reserve requirements.
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Cyndy
1 year ago
D) To prevent the collapse of the banking system
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Temeka
1 year ago
C) To regulate the profits of commercial banks
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Dyan
1 year ago
B) To avoid the commercial banks running out of liquidity
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Sherell
1 year ago
A) To influence commercial banks' ability to create credit
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Man
1 year ago
I think the answer is C) To regulate the profits of commercial banks.
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