Which of the Following Statements About Direct Credit Substitutes Provided

question 86

Multiple Choice

Which of the following statements about direct credit substitutes provided by a commercial bank is incorrect?

• A) They are provided to support a client's financial obligations.
• B) An example of a direct credit substitute is a bank guarantee.
• C) The bank provides funding to a third party instead of the client providing the funding.
• D) With a direct credit substitute a bank's client can raise funds directly from the financial markets.

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