Solved

In the Diamond-Dybvig Model, the Bank's Deposit Contract Has the Following

Question 49

Multiple Choice

In the Diamond-Dybvig model, the bank's deposit contract has the following important features:


A) it allows a bank depositor to withdraw currency.
B) it insures depositors against the event that they consume early.
C) it implies that late consumers want to pose as early consumers.
D) it implies a bank run is prevented.
E) it gives more consumption to early consumers than later consumers.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions