Suppose there is a bank panic.Which of the following would not be a consequence of this bank panic?

Question

Quizplus · Accepted Answer

In a bank panic, the total reserves of banks would decrease, as depositors withdraw their funds. This would also lead to a decrease in checking account balances, as the banks would have less money to lend out. Individual banks may have to shrink the value of loans they made as a result of the decrease in reserves. In addition, a bank panic can have significant negative effects on the economy, potentially leading to a recession. However, required reserves would not increase as a consequence of a bank panic.

Suppose There Is a Bank Panic