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The FDIC Insures Each Deposit Up to $100,000 in the Banking

question 26

Essay

The FDIC insures each deposit up to $100,000 in the banking system. If you are a manager of a bank and if your bonus is tied to the number of loans you generate, will you care about the nature of the loans and their risk?


Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.

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