The Manner in Which FDIC Deposit Insurance Is Set Up

question 143

Multiple Choice

The manner in which FDIC deposit insurance is set up in the United States encourages banks to

• A) be too conservative in their lending practices.
• B) maintain excess reserves that are too great.
• C) make riskier loans than they otherwise would.
• D) reject some loans that probably would be profitable.

---

Definitions:

Musk Oxen

Large, shaggy bovids native to the Arctic regions, known for their thick coats and strong odors produced by glands during the mating season.

Biome

Large community of plants and animals that occupies a distinct region defined by its climate, flora, and fauna.

Desert Soils

Soils found in desert regions characterized by low moisture content, minimal organic matter, and often high salinity levels, supporting limited plant life.

Organic Material

Substance made up of organic compounds originating from the remnants of organisms like plants and animals, including their waste in the natural surroundings.