The Reason That a Run on a Single Bank Can

question 24

Multiple Choice

The reason that a run on a single bank can turn into a bank panic that threatens the entire financial system is:

• A)Information asymmetries
• B)Moral hazard
• C)The lack of regulation
• D)The increased reliance on web-based funds transfers

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Definitions:

SBAR

An acronym for Situation, Background, Assessment, Recommendation - a communication framework used in healthcare to facilitate prompt and appropriate communication.

Assessment

The process of evaluating or estimating the nature, ability, or quality of something, often used in educational, professional, or healthcare settings to determine needs or performance.

Recommendation

A suggestion or proposal as to the best course of action, often based on analysis and assessment.

False Reassurance

Providing comfort or assurance without sufficient basis or truth, potentially undermining trust and delaying necessary actions or interventions.