By Rescuing Large,troubled Institutions,as Happened During the Great Recession with Institutions

question 53

Multiple Choice

By rescuing large,troubled institutions,as happened during the Great Recession with institutions like AIG and General Motors,policymakers attempted to achieve financial and economic stability in the short run,but their actions may encourage even riskier behaviour on the part of these large institutions in the future if these institutions believe that they,too,will be bailed out if they get in trouble.This risk faced by policymakers is known as

• A) asymmetric information.
• B) quantitative easing.
• C) too-big-to-fail policy.
• D) moral hazard.

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Definitions:

Erikson's View

The perspective of Erik Erikson, a developmental psychologist who proposed a theory of psychosocial stages across the lifespan.

Midlife

A period of life, usually considered to occur approximately between the ages of 40 and 60, characterized by various physical, psychological, and social changes.

Vaillant

Refers to George E. Vaillant, a psychiatrist known for his research on how people adapt to stress and other psychological processes across the lifespan.

Agentic

Pertains to an individual's sense of agency, or the ability to act independently and make free choices, shaping one's own life path.