Why were banks one of the first institutions to feel the effects of the stock market crash?
a People began to lose confidence in the economy and frightened depositors began to remove their money from banks.
b Banks gave out too many loans in the early 1920s so there was a great deal of money in circulation.
c The Federal Reserve increased interest rates in the 1920s to stimulate economic growth, but then limited money supply to discourage lending.
d After the stock market crash people went to banks to secure their hard money so they could circulate it back into the economy.

Question

Why were banks one of the first institutions to feel the effects of the stock market crash?
a People began to lose confidence in the economy and frightened depositors began to remove their money from banks.
b Banks gave out too many loans in the early 1920s so there was a great deal of money in circulation.
 c The Federal Reserve increased interest rates in the 1920s to stimulate economic growth, but then limited money supply to discourage lending.
d After the stock market crash people went to banks to secure their hard money so they could circulate it back into the economy.