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Why does the government regulate the financial system

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Reference no: EM132603209

Regardless of the size and the level of financial system development both adverse selection and moral hazard may happen in lending-borrowing process.

Question a) How has the financial system developed to manage these problems?

Question b) Why does the government regulate the financial system

Question c) What regulations are or have been used to protect the public from adverse selection and moral hazard?

Reference no: EM132603209

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