Final answer:
The Federal Reserve acts as a lender of last resort to prevent bank runs and safeguard the financial system, complemented by deposit insurance to reassure bank customers.
Step-by-step explanation:
A lender of last resort is a role fulfilled by the Federal Reserve to prevent bank runs and safeguard the financial system. In the event of a bank run, where depositors rush to withdraw their money, the Fed will lend funds to banks and financial institutions that cannot obtain funds elsewhere. This role complements deposit insurance by providing an additional layer of protection for bank customers. With the lender of last resort and deposit insurance, bank customers can be reassured that their money is safe even during times of financial panic.