A Disadvantage of Using Purchased Liquidity Management to Manage a FI's

question 13

Multiple Choice

A disadvantage of using purchased liquidity management to manage a FI's liquidity risk is

• A)the resulting shrinkage of the FI's balance sheet.
• B)the relatively high cost of purchased liabilities.
• C)the accessibility of international money markets.
• D)tax considerations.

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Definitions:

Startup

An entrepreneurial venture typically in the early stages of operations, often innovation-driven and aiming to meet a marketplace need by developing a viable business model around a product, service, process, or platform.

Lemon

In economic terms, refers to a product, especially a used car, that is found to be defective only after it has been bought.

Apprenticeship

A system of training a new generation of practitioners of a trade or profession with on-the-job training and often some accompanying study (classroom work and reading).

Entrepreneurs

Entrepreneurs are individuals who create, organize, and lead a business venture, taking on financial risks in the hope of profit, driven by innovation, and operationalizing ideas into marketable products or services.