A bank run occurs when:
A)consumers increase their deposits at banks faster than the bank can loan out the funds.
B)many people want to withdraw their savings from a bank at the same time, and the bank does not have enough cash on hand.
C)too many borrowers want to take out loans from a bank, and the bank is unable to meet loan demands.
D)interest rates are too high.

Question

Quizplus · Accepted Answer

A bank run occurs when many customers of the bank want to withdraw their funds from the bank at the same time, and the bank does not have enough cash on hand to meet the demand for withdrawals. This can lead to a situation where the bank is forced to close its doors or go bankrupt, which can have widespread implications for the economy.

A Bank Run Occurs When