Which statement best describes bank runs today?
A) Bank runs are uncommon because of the high required reserve ratio.
B) Bank runs are uncommon because of CDIC deposit insurance.
C) Bank runs are common because of the low required reserve ratio.
D) Bank runs are common because the CDIC is inefficient.

Question

Quizplus · Accepted Answer

Bank runs are less common today because of CDIC deposit insurance. The Canadian Deposit Insurance Corporation (CDIC) provides deposit insurance to protect eligible deposits up to $100,000 per account in case of a bank failure. This gives depositors a level of confidence that their money is safe and reduces the likelihood of bank runs.

Which Statement Best Describes Bank Runs Today