Bank Runs Are a Possibility Because

question 248

Multiple Choice

Bank runs are a possibility because

• A) the FDIC is inefficient.
• B) bankers are often poor businesspeople.
• C) in difficult times people want currency instead of demand deposits.
• D) banks do not keep enough reserves to cover all their depository liabilities.

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Definitions:

Scope of Employment

Refers to the range of activities and duties that an employee is expected to perform as part of their job.

Undisclosed Principal

A party in a contract whose identity is unknown to the third party at the time the contract is made.

Unauthorized Agent

An individual who acts on behalf of another party without being granted the legal or official authority to do so.

Respondeat Superior

A legal doctrine holding employers liable for the actions of their employees performed within the scope of their employment.