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A financial institution can offer customer deposit accounts that are highly liquid and have low risk in order to fund ba...

A financial institution can offer customer deposit accounts that are highly liquid and have low risk in order to fund bank assets that are illiquid with higher risk because of both ___________ and ____________.

A.

Primary markets; foreign exchange markets
B.

Monitoring; diversification
C.

Free riders; regulation
D.

Price risk; collateral
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Answer #1

Monitoring; diversification

A financial Institution is able to achieve diversification in risk profile and liquidity.

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