To Offset the Moral Hazard Problem Created by the FDIC

question 88

Multiple Choice

To offset the moral hazard problem created by the FDIC, the government:

• A)created securities to spread the risks.
• B)created the Federal Reserve Bank.
• C)separated banks from other financial institutions.
• D)required individuals to pay a portion of the insurance costs.

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Definitions:

Receptors

Proteins on the surface of cells that bind to specific molecules, triggering a response within the cell.

Muscle Fiber

A single muscle cell, known for its elongated shape, which contracts to produce bodily movements.

Action Potential

A temporary reversal of an electric polarization of the membrane of a nerve cell or muscle cell.

Presynaptic Terminal

The end of a neuron from which neurotransmitters are released to communicate with another neuron at a synapse.