Today,bank Runs Are

question 110

Multiple Choice

Today,bank runs are

• A)uncommon because of the high reserve requirement.
• B)uncommon because of FDIC deposit insurance.
• C)common because of the low reserve requirement.
• D)common because the FDIC is nearly bankrupt.

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Definitions:

Compounded Semiannually

Interest calculation method where interest is added to the principal sum of a deposit or loan twice a year, resulting in interest earning interest.

Compounded Annually

A method of calculating interest where the interest earned each year is added to the principal, leading to an increase in the amount of interest earned in subsequent years.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, used in discounting and investment appraisal.

Annuity

A fiscal tool that disburses a set sequence of payments to a person, frequently serving as a financial income for retirees.