Which Statement Best Explains Whether Bank Runs Are a Problem

question 59

Multiple Choice

Which statement best explains whether bank runs are a problem for the economy?

• A) They are not a problem because bank runs will affect neither the money supply nor the money multiplier.
• B) Bank runs are only a problem for insolvent banks.
• C) They are a problem, but they can be neither prevented nor stopped by a central bank.
• D) Bank runs are a problem because bank failures may spread to healthy banks.

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Definitions:

Temporally

Refers to something related to or involving time.

Repeated Studying

A learning technique involving multiple sessions of reviewing material over a span of time.

Repeated Testing

The process of administering a test multiple times to the same subjects to improve reliability, measure changes, or reinforce learning.