A bank run involves:
A) illegal activities on the part of the bank's officers.
B) a bank being forced into bankruptcy.
C) a large number of depositors withdrawing their funds during a short time span.
D) a bank's return on assets being below the acceptable level.

Question

Quizplus · Accepted Answer

A bank run occurs when a large number of depositors withdraw their funds from a bank during a short time span due to concerns about the bank's solvency or ability to meet obligations. It is not necessarily caused by illegal activities or a low return on assets, although those factors could contribute to depositor concern. A bank run can potentially lead to a bank's failure or bankruptcy if it is unable to meet the demand for withdrawals.

A Bank Run Involves