Implicit government support for "too-big-to-fail" banks:
A. increases the scrutiny of the bank's risk by large corporate depositors.
B. reduces the moral hazard problem of insuring large banks.
C. reduces the risk faced by depositors with accounts less than $250,000.
D. reduces the risk faced by depositors with accounts exceeding $250,000.
Answer: D
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The most significant cost to a central bank of reducing unemployment is the costs
a. incurred by printing and distributing new money. b. of lower output. c. of higher real wages. d. of inflation.
One of the most widely reported measures of inflation is the: a. consumer price index. b. producer price index. c. GDP deflator
d. Gini coefficient. e. real interest rate.
Which of the following reduces the interest rate?
a. an increase in government expenditures and an increase in the money supply b. an increase in government expenditures and a decrease in the money supply c. a decrease in government expenditures and an increase in the money supply d. a decrease in government expenditures and a decrease in the money supply
Economists know that if consumers and producers are both made better off, they would be without free exchange because the exchanges are
A. able to make producers better off by an amount that compensates consumers for their losses. B. able to make consumers better off by an amount that compensates producers for their losses. C. voluntary. D. mandated by government.