Question
Which of the following balance sheet entries is not a tool used in purchased liquidity management? A. Bonds. B. Federal fund. C. Demand deposit. D.
Which of the following balance sheet entries is not a tool used in purchased liquidity management?
| A. | Bonds. | |
| B. | Federal fund. | |
| C. | Demand deposit. | |
| D. | Repurchase agreement. | |
| E. | Subordinated note. |
Why have purchased liquidity management techniques become very popular in spite of its limitations? A. Because it insulates the assets of an FI from normal drains on liability liquidity. B. Because funds can be easily raised in the eventuality of a liquidity crunch. C. Because of decrease in the cost of funds during periods of high interest rate volatility. D. Because the funds are covered by deposit insurance. E. Because the adjustment to the deposit drain occurs on the liability side of the balance sheet.
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What information does the net liquidity statement provide?
A. A long-term focus on liquidity.
B. Sources and uses of liquidity.
C. Net asset value.
D. Liquidity index information.
E. Peer group ratio comparison.
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