Which of the Following Best Explains Whether Bank Runs Are

question 133

Multiple Choice

Which of the following 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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