If the Government Guarantees Liabilities of Financial Institutions Other Than

question 135

Multiple Choice

If the government guarantees liabilities of financial institutions other than deposits:

• A)those financial institutions will have the incentive to engage in overly risky behavior.
• B)those financial institutions will have the incentive to engage in less risky behavior.
• C)the Federal Reserve will be forced to raise reserve requirements.
• D)the economy will be pushed close to the zero bound on interest rates.

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Definitions:

Initial Antigen

The first exposure of the immune system to a foreign molecule or pathogen, triggering an immune response.

Primary Response

The initial response of the immune system to a new antigen, typically involving the activation and proliferation of specific lymphocytes.

Secondary Response

The immune system's enhanced reaction upon a second or subsequent encounter with an antigen, typically faster and more vigorous than the primary response.

Initial Antigen

The foreign substance or pathogen that triggers an immune response in the body, leading to the production of antibodies.