a)

A liquidity crisis can be resolved if lenders are willing to wait long enough for borrowers to sell their assets and obtain cash to repay their debts. True or false?

b)

Making the risk of debt securities virtually impossible to analyse can increase the liquidity of debt markets. True or false?

c)

What is important for highly liquid markets is not the actual level of information asymmetry amongst market participants but their belief that they are not informationally disadvantaged. True or False?

d)

Financial crises are often caused by the speed of change in interest rates rather than a high level of interest rates. True or false?

e)

The availability of subprime borrowers to get access to capital at low interest rates is consistent with an efficient market. True or false?