Which of the following is intended to prevent bank runs?
A)the Sherman Anti-Trust Act
B)regulation Q, which prohibits banks from paying interest on demand deposits
C)deposit insurance
D)maturity transformation

Question

Quizplus · Accepted Answer

Deposit insurance helps prevent bank runs by guaranteeing that customers' deposits will be protected even if the bank fails. This reduces the likelihood that panicked customers will rush to withdraw their funds all at once, causing a bank run.

Which of the Following Is Intended to Prevent Bank Runs