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Which of the following is NOT a key focus of the Financial Sector Assessment Program?
Evaluating financial stability
Enhancing regulatory frameworks
Managing public debt
Assessing financial sector vulnerabilities
The correct answer is: Managing public debt
The correct answer highlights that managing public debt is not a key focus of the Financial Sector Assessment Program (FSAP). The FSAP is primarily concerned with the stability and functionality of a country's financial system. This includes evaluating financial stability, which involves assessing how resilient the financial system is to economic shocks and stresses. Enhancing regulatory frameworks is another critical component of the FSAP, as it aims to ensure that there are appropriate oversight and regulatory practices in place to safeguard the financial system. Assessing financial sector vulnerabilities is also a key area of focus, as it allows for the identification of potential risks that could threaten the financial sector's stability. While managing public debt is certainly an important aspect of overall economic management, it falls outside the core scope of the FSAP, which is more concentrated on the health and regulatory aspects of the financial system rather than public finance matters. Therefore, recognizing that managing public debt is not directly linked to the FSAP's primary objectives clarifies why this answer is correct.