Suppose you are a depositor at first street bank. you hear a rumor that the bank has suffered serious losses on its loans. every depositor knows that the rumor isn't true, but each thinks that most other depositors believe the rumor. the bank is not fdic insured. whats the rational response to this situation?

Respuesta :

W0lf93
The rational response would be to grab your money and run. The bank isn't FDIC insured so if everyone is thinking that everyone thinks the rumor is true than this is going to cause a huge influx in the number of people withdrawing money and less people depositing money. If this goes on too long the bank will run out of money and it's not insured so no one will replace what you lost if you didn't pull it out in a timely manner.