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Theoretically, What Are the Consequences If the Government Assumes the Burden

Question 56

Multiple Choice

Theoretically, what are the consequences if the government assumes the burden of bad loans?


A) Citizens will default on their mortgages.
B) Banks will learn from their mistakes and pay back the burden with interest.
C) Ultimately, the government will profit.
D) Firms will be encouraged to continue their risky behavior.

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