Which of the Following Is False

Multiple Choice

Which of the following is false?

A) Almost all banks have elected to purchase deposit insurance through the FDIC because they feel it is important to offer depositors the safety and peace of mind that deposit insurance engenders.
B) A "run" on even a healthy, solvent bank can cause severe difficulties because the bank's asset portfolio may be illiquid with not enough cash or liquid assets on hand to pay off the many depositors making withdrawals.
C) Deposit insurance was first made a "full faith and credit obligation" of the federal government in 1989. Prior to that year, the FDIC was on somewhat the same footing as private insurance companies in that the federal government was not required by law to pay off depositors if the FDIC ran out of funds in the face of widespread bank failures.
D) Deposit insurance has always been a "full faith and credit obligation" of the federal government. That is why no depositor has lost any money in any account in a bank with FDIC insurance since the inception of the FDIC.