Which one of the following is presently a major deterrent to bank panics in the United States?
A) The legal reserve requirement.
B) The fractional reserve system.
C) The gold standard.
D) Deposit insurance.

Question

Quizplus · Accepted Answer

Deposit insurance is presently a major deterrent to bank panics in the United States. The Federal Deposit Insurance Corporation (FDIC) provides deposit insurance to protect depositors up to a certain amount in case a bank fails. This helps restore confidence in the banking system and prevents bank runs and panics. The legal reserve requirement and fractional reserve system are methods of regulating the banking system but do not directly address bank panics. The gold standard is no longer in use in the United States.

Which One of the Following Is Presently a Major Deterrent