Author Question: Government-backed deposit insurance increases the ________. A) Willamette torsion effect B) ... (Read 31 times)

michelleunicorn · **on:** Jun 30, 2018

Government-backed deposit insurance increases the ________.

A) Willamette torsion effect
B) adverse selection problem
C) moral hazard problem
D) the prudential contagion problem

Question 2

Based on the Saving-Investment Diagram, if the world real interest rate is indicated by A, then ________.

A) the difference between values G and E measures the trade surplus
B) the difference between values G and F measures the trade surplus
C) the domestic real interest rate is indicated by B
D) desired saving has decreased
E) none of the above