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Which of the Following Functions Are Performed by Depository Institutions

question 485

Multiple Choice

Which of the following functions are performed by depository institutions?
I. They make long-term loans using short-term deposits, thereby creating liquidity.
II. They efficiently gather funds from a large base of depositors.
III. They concentrate risk.


Definitions:

Short Run

A period in economics where at least one factor of production is fixed and cannot be changed, influencing the adjustment capabilities of a business.

Elasticity of Demand

An analysis demonstrating how changes in pricing impact the demand for a good.

Paper Newspapers

Traditional newspapers made from paper, providing news, information, and advertisements, typically published on a daily or weekly basis.

Interpretation

The process of explaining or providing the meaning of something, such as a data set, text, concept, or event.

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