Multiple Choice
Which of the following is a consequence of deposit insurance?
A) It may induce the officers of a bank to take more risks.
B) It encourages banks to make loans only to the most credit-worthy customers.
C) It minimizes the risk of defaulting on loans made to the bank's customers.
D) It encourages depositors to closely scrutinize a bank's lending activities.
Correct Answer:
Verified
Correct Answer:
Verified
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