A more thorough explanation:

Definition: Regulation Q is a rule created by the Federal Reserve Board that sets limits on the amount of interest that banks can pay on savings accounts and regulates how banks advertise their interest rates. This regulation applies to all commercial banks and is based on the Banking Act of 1933.

Example: Let's say you have a savings account with a bank that is subject to Regulation Q. The bank is only allowed to pay you a certain amount of interest on your savings, even if they could afford to pay you more. This is to prevent banks from engaging in unfair competition and to promote stability in the banking system.

Another example: A bank that is subject to Regulation Q is also required to follow certain rules when advertising their interest rates. For example, they cannot use misleading language or make promises that they cannot keep. This is to protect consumers from being misled and to ensure that banks compete fairly with each other.

Overall, Regulation Q is an important tool that helps to regulate the banking industry and protect consumers from unfair practices.