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What Is the Primary Argument for Not Giving Depositors Greater

Question 7

Multiple Choice

What is the primary argument for not giving depositors greater incentive to monitor financial institutions?


A) Experts do not believe that depositors are capable of monitoring banks and imposing discipline on them.
B) Banks could be subject to more frequent runs by nervous depositors.
C) Both A and B are correct.
D) Neither A nor B is correct.

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