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25 January, 09:18

A "bank run" takes place when a large number of people withdraw their money at once. How might the Federal Reserve support a bank to ensure that all of the depositors would get their money back if there were a bank run?

By directly paying back the depositors

By raising the prime interest rate

By lending money to the bank

By issuing government bonds

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Answers (2)
  1. 25 January, 10:06
    0
    By lending money to the bank

    NOT prime interest rates, just got it wrong on the test!
  2. 25 January, 11:45
    0
    By raising the prime interest rate, more interest means more people want to put their money in a bank
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