If Stored Liquidity Is Used by a DI to Fund

question 10

Multiple Choice

If stored liquidity is used by a DI to fund an exercised loan commitment

• A)the balance sheet will decrease by the amount of the new loan.
• B)only the asset side of the balance sheet will increase.
• C)the balance sheet will increase by the amount of the new loan.
• D)only the liability side of the balance sheet will increase.
• E)there will be no effect on the balance sheet.

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Definitions:

Repetition

The action of repeating something that has already been said or written, often used for emphasis or to reinforce a concept.

Enumerated List

An ordered listing of items or points, often numbered or bulleted.

Bulleted List

An itemized list used for organizing information efficiently, each entry preceded by a symbolic bullet.

Deductively Organized

An approach to organization that starts with a general assertion or hypothesis and then presents specific evidence or examples to support it.