Choose the Statement That Is Incorrect

question 5

Multiple Choice

Choose the statement that is incorrect.

• A)A financial institution can be solvent but illiquid.
• B)A firm is illiquid if it has made long-term loans with borrowed funds and is faced with a sudden demand to repay more of what is has borrowed than its available cash.
• C)Insolvency and illiquidity were at the core of a global financial meltdown in 2007-2008.
• D)A financial institution's net worth is the market value of what it has lent minus the market value of what it has borrowed.
• E)All of the above are true.

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Definitions:

Goal Shielding

The process of protecting one's focus on achieving a particular goal by resisting distractions and unrelated objectives.

Strict Diet

A rigorous and specific plan for eating, often for health or weight management purposes, that limits certain foods or nutrients.

High-stress

A condition or environment characterized by significant psychological pressure or strain, often resulting in physical or emotional health challenges.

Reactance

A provoked emotional response to offers, entities, principles, or regulations that compromise or revoke certain freedoms of conduct.