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Depositors do not check their banks carefully for stability anymore, because of the Federal deposit insurance program. This illustrates the problem of________________.

Respuesta :

Answer:

Moral hazard

Explanation:

Moral hazard is when a person increases their exposure to risk when insured.

Due to the FDIC insuring deposits, depositors no longer check and monitor their banks' performance closely because they know their deposits are insured. If their bank fails, they would not lose their deposits.

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