In the Diamond-Dybvig model a bank run occurs because
A) early consumers all choose to withdraw their deposits in period 2.
B) early consumers all choose to withdraw their deposits in period 1.
C) late consumers all choose to withdraw their deposits in period 1.
D) early and late consumers choose not to deposit in the bank.
E) late consumers all choose to withdraw their deposits in period 2.
Correct Answer:
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Q11: In the Diamond-Dybvig model
A)consumers are not risk
Q12: In the Diamond-Dybvig model, a bank run
Q13: Bank runs
A)were eliminated by the CDIC.
B)are a
Q14: The Diamond-Dybvig model provides an account of
A)lack
Q15: The founding of the Canada Deposit Insurance
Q17: The Diamond-Dybvig bank provides a useful social
Q18: In a bank run, the equilibrium deposit
Q19: A bank
A)cannot be regulated.
B)is essentially the same
Q20: Banks in the Diamond-Dybvig model can offer
Q21: One characteristic of a financial intermediary is
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