(Last Word) Solvent firms face the threat of bankruptcy during a financial crisis
A) because, by law, the Federal Reserve can only serve as lender of last resort to insolvent firms.
B) because the value of their assets is less than the value of their debts.
C) when many assets are illiquid, making it difficult to make timely payments on debt.
D) because the Federal Reserve extends loans to these firms at high rates of interest.
Correct Answer:
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