12) High t ansaction and information costs in the financial syste A)benefit benefit havers at the expense of borrowers for o greater government regulatios at D) 13) Commercial that can reduce these costs I banks face liquidity risk because: A) they may have difficulty meeting short-terin depositor's demands 15) government borrowings are difficult to predict C) they do not have enough reserves to lend to customers D) they do not have access to the discount window 14) Which of the following is NOT covered by federal deposit insurance?_ A) checking accounts B) time deposits C) savings accounts D) money market funds 15) When a bank uses money from a checking account to make a loan, it has transformed: A) a short-term liability to a borrower into a long-term asset to a saver B) one liability into another liability for the saver C) a financial liability for a saver into a financial asset for a borrower D) a financial asset for a saver/investor into a liability for a borrower 16) The Bank for International Settlements (BIS): A) serves to promote global monetary and financial stability B) clears global payments and foreign exchange transactions C) manages governmental debt for the European Union D) is the lender of last resort for European banks 17) A bank's revenue includes all of the following EXCEPT A) cash held in bank vault B) interest on securities C) debit and credit card service fees D) interest on loans 18) A mark-to-market involves: A) adjusting cash and/or collateral based the net change on the value of derivatives B) changing the futures price to the spot price C) reducing trading risk by using futures and other derivatives D) updating futures and derivatives prices