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    Macroeconomics Study Set 68
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    Exam 4: Market Failures Caused by Externalities Asymmetric Information
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    When the Government Bails Out Failing Banks, It Creates a Moral
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When the Government Bails Out Failing Banks, It Creates a Moral

Question 40

Question 40

True/False

When the government bails out failing banks, it creates a moral hazard problem; but when the
government bails out homeowners who are defaulting on their mortgages, there is no moral hazard
problem.

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