You Do Not Worry About How Your Bank Is Investing

question 68

Multiple Choice

You do not worry about how your bank is investing your money because your deposits are federally insured. This is an example of

• A) a positive spillover.
• B) moral hazard.
• C) adverse selection.
• D) irrational behavior.

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Definitions:

Formal Chain

A structured sequence of command or a hierarchy within an organization, where communication and decisions flow through a pre-defined path.

Efficiency

The ability to accomplish a task or objective with the minimal expenditure of time and resources.

Competing Values Framework

A model that categorizes organizational cultures into four distinct types based on two dimensions: focus (internal vs. external) and structure (flexibility vs. stability).

Market Culture

A type of organizational culture that is characterized by a strong emphasis on competitiveness, results, and achieving measurable goals.