Banks provide:
A) liquidity.
B) adverse selection.
C) moral hazard.
D) None of these are provided by banks.

Question

Quizplus · Accepted Answer

Banks provide liquidity by accepting deposits from customers and creating loans for borrowers. This allows individuals and businesses to access the funds they need for various purposes, while also providing a safe place for their money to be stored. Adverse selection and moral hazard are risks that banks must manage, but they are not services provided by banks.

Banks Provide