1) Depositors lack of information about the quality of bank assets can lead to ________.
A) bank panics
B) bank booms
C) sequencing
D) asset transformation
2) The fact that banks operate on a “sequential service constraint” means that
A) all depositors share equally in the bank”s funds during a crisis.
B) depositors arriving last are just as likely to receive their funds as those arriving first.
C) depositors arriving first have the best chance of withdrawing their funds.
D) banks randomly select the depositors who will receive all of their funds.
3) Depositors have a strong incentive to show up first to withdraw their funds during a bank crisis because banks operate on a
A) last in, first out constraint.
B) sequential service constraint.
C) double coincidence of wants constraint.
D) everyone shares equally constraint.