Systemic risk
What Systemic risk means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Systemic risk
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Reference: Pearson Edexcel
The risk of failure spreading across the financial sector, which the lender of last resort function aims to prevent by stopping a bank run from causing systemic failure.
A risk across the UK financial system that the Financial Policy Committee identifies, monitors, and takes action to reduce.
Topics that use Systemic risk
- The role of the central bank (Pearson Edexcel A-Level)
Related terms
- Base rate
- Central bank
- Central banking
- Financial stability
- Inflation targeting
- Inflationary pressures
- Liquidity and solvency
- Macroprudential regulation
Using Systemic risk in the exam
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