Which of the Following Statements Is True

question 8

Multiple Choice

Which of the following statements is true?

• A)An increase in the liquidation costs of non-liquid assets encourages an FI to shift more funds into more liquid, lower yielding assets.
• B)A decrease in the yield of non-liquid assets will reduce holdings of liquid assets due to higher opportunity costs of holding liquid assets.
• C)The greater the volatility of the level of deposits, the greater the optimal proportion of reserve assets held to deposits.
• D)An increase in the liquidation costs of non-liquid assets encourages an FI to reduce their holdings of more liquid, lower yielding assets.

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Definitions:

Epigenetic Marks

Changes in DNA and histone proteins that impact how genes are expressed, without modifying the DNA sequence.

DNA

Deoxyribonucleic acid, a molecule that carries the genetic instructions used in the growth, development, functioning, and reproduction of all known living organisms.

Protein Molecules

Large biomolecules comprised of one or more long chains of amino acid residues which play critical roles in the body, including catalyzing metabolic reactions and DNA replication.

Epigenetic Mark

Alterations to DNA and histone proteins that influence gene activity without changing the DNA sequence itself.