The "run" on the bank mentioned in the text is an example of how panic may lead to ______.

Question

Quizplus · Accepted Answer

A "run" on the bank occurs when several customers simultaneously withdraw their deposits, leading to a widespread panic that the bank may not have enough reserves to meet its obligations. This is an example of a self-fulfilling prophecy because the fear of a bank failure leads to an actual bank failure. Panic may trigger a chain reaction that reinforces initial beliefs, leading to a situation that becomes true because people act as if it is. Therefore, panic can be a self-fulfilling prophecy. Attributional ambiguity, central trait, and halo effect are phenomena related to the attribution process and not to the consequences of collective behavior.

The "Run" on the Bank Mentioned in the Text Is