Rumors of a Bank Failing, Even If Not True, Can

question 114

Multiple Choice

Rumors of a bank failing, even if not true, can become a self-fulfilling prophecy because:

• A) customers will not want to obtain loans from this bank.
• B) equity investors will not be able to sell the bank's stock.
• C) regulators will scrutinize the bank heavily looking for something wrong.
• D) depositors will rush to the bank to withdraw their deposits and the bank under normal situations would not have sufficient liquid assets on hand.

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Definitions:

High Self-Esteem

High self-esteem refers to a positive evaluation of oneself, characterized by feelings of self-worth, confidence, and respect for oneself.

Western Culture

A term describing societies influenced by European traditions, often focusing on values like democracy, rationality, and individual rights.

Society

A structured community of people bound together by similar traditions, institutions, or nationality, often characterized by complex relations and collective goals.

Partnership Agreement

A contract between partners that outlines the terms of the partnership, including contributions, profit sharing, and management roles.