Which Intermediation Function Results in an FI's Exposure to Liquidity

question 92

Multiple Choice

Which intermediation function results in an FI's exposure to liquidity risk?

• A)Information production.
• B)Asset transformation.
• C)Conduit for monetary policy.
• D)Lender of last resort.
• E)Brokering between funds deficit units and funds surplus units.

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Definitions:

Source Of Cash

The origin of funds that a company or individual has, which could be operational earnings, investment returns, or financing.

Merchandise Sale

A commercial transaction where goods are sold to consumers.

Long-Term Debt

Long-term debt is loans and financial obligations lasting more than one year, often used for business expansion or large capital investments.

Stock Repurchase

A stock repurchase is when a company buys back its own shares from the marketplace, often to increase the value of remaining shares.