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From course:

Economics A Level (DONEEEEEEE)

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Question:

Why can Bank Runs be so Awful for Banks?

Author: eric_galvao



Answer:

-If all Depositors took all their Savings out at the Same Time, then the Bank may fail to Repay them all due to a lack of Liquid Assets in their Reserve -Bank Runs usually happen when there are Rumours or Fears about the Bank's Stability, Profitability or Solvency are Questioned


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