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The FDIC Handles Most Bank Failures by the Purchase and Assumption

Question 31

Multiple Choice

The FDIC handles most bank failures by the purchase and assumption method because


A) the existence of uninsured deposits (over $100,000) makes runs and panics possible.
B) it allows the FDIC to avoid paying off large deposits when a bank fails.
C) most banks have become too big for the FDIC to allow them to fail.
D) it allows the FDIC to write checks legally to pay all deposits, even those over $100,000.

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