tARP and other lender-of-last-resort programs implemented by the Fed in response to the financial crisis of 2007 and 2008 Multiple Choice were designed to offset the moral hazard created by the TARP and other bailout programs. have been little used and therefore are ineffective. severely depleted the assets of the Federal Reserve. increased the moral hazard problem by limiting losses from bad financial decisions.

Anew 2-lane road is needed in a part of town that is growing. at some point the road will need 4 lanes to handle the anticipated traffic. if the city's optimistic estimate of growth is used, the expansion will be needed in 4 years and has a probability of happening of 40%. for the most likely and pessimistic estimates, the expansion will be needed in 8 and 15 years respectively. the probability of the pessimistic estimate happening is 20%. the expansion will cost $ 4.2 million and the interest rate is 8%. what is the expected pw the expansion will cost?